01:55 PM EDT, 10/18/2024 (MT Newswires) -- According to Avery Shenfeld, a 50 basis point rate cut from the Bank of Canada next Wednesday is "a reasonable bet, and rightly so" in the face of softer inflation and sluggish Q3 growth. Shenfeld expects the BoC will downgrade its growth call for the quarter, but he doesn't expect it to get too pessimistic about growth next year, since it should view the inflation trend as giving it 'carte blanche' to do what it takes to get the economy moving at a faster clip.

As for the rate outlook ahead, Shenfeld said those used to Fed dot plots, or musings from the Fed chair, need to remember that Canada's central bankers aren't fans of explicit forward guidance. "So," he added, "we wouldn't expect anything more than a reiteration of the statement that further reductions in interest rates would be a likely outcome if economic developments unfold as they expect."

On the data front, Shenfeld said a "healthy" ex-autos retail sales report for August next Friday won't do much to alter the medium trend of lacklustre per capita consumption growth.

(The CIBC data calendar also has September Industrial Prod. Prices and Raw Materials data due on Tuesday.)

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