04:15 PM EST, 03/06/2024 (MT Newswires) -- After being pushed up to as high as 21,712 early in today's session, Canada's main stock market closed out Wednesday with more modest gains of 68 points at 21,594, with the resources heavy index buoyed by higher commodity prices, but held back on the increasing probability of delayed rate cuts across North America after Central Bank updates.

Economists in Canada came away from Wednesday's monetary policy update from the Bank of Canada thinking the Central Bank had "ruled out near term easing" of rates, and that "risks are skewed to cuts starting at a later meeting, rather than an earlier one". Economics in the United States came away from monitoring testimony from the Chair Powell with just as little clarity after he provided a timeline to cut rates of "this year".

Of commodities today, gold closed at record highs for a fourth-straight session as congressional testimony from Federal Reserve Chair Jerome Powell, did not shed light on when the U.S. central bank will begin lowering interest rates. Gold for April delivery was last seen up $16.30 to US$2,158.20 per ounce.

Also, West Texas Intermediate crude oil closed higher after a report showed a smaller than expected rise in US oil inventories last week and lower US production, offsetting concerns over the health of China's economy. WTI crude oil closed up $0.98 to settle at US$79.13 per barrel, while May Brent crude, the global benchmark, was last seen up $0.93 to US$82.97.

Most sectors were higher, led by Base Metals, up more than 2%, while Energy rose a modest 0.25%.

On rates, Derek Holt, Vice-President & Head of Capital Markets Economics at Scotiabank, in a note entitled 'BoC Rules Out Near-Term Easing -- And It's Standing On Guard Into Springtime' said the Bank of Canada met Scotia's expectations for it to "lean against any sentiment it was moving toward easing policy in the near-term". Holt added: "Advice to pay nearer term contracts continues to pay off for institutional clients and we remain comfortable with a call for the first cut to be delivered only by the September meeting and a lot has to go right to even get to that."

According to Holt, the broad takeaways include basically ruling out easing in April, while setting a high bar to act any time soon thereafter -- alongside a more explicit warning on the Spring housing market and the current government Budget season. Holt was surprised by the explicit move to rule out changes to Quantitative Tightening plans. He said: "It's a hawkish message for the rest of the term structure on a relative rates basis compared to the Federal Reserve's likely moves."

Elsewhere, David Doyle, head of economics at Macquarie, said the outlook for the BoC is unchanged for he and his team. Macquarie expects 50 bps of easing in 2024. Doyle said this is less than market expectations (near 85 bps) and consensus (100 bps). Macquarie sees the first rate cut as occurring in July (vs. consensus in June). But "risks are skewed to cuts starting at a later meeting, rather than an earlier one", it added.

RBC, for its part, sees 100bp of cuts in 2024, starting in June, with a later timing (July or Sep) "significantly more likely than earlier" -- saying it is "hard to see April as a viable probability given the short gap between today's meeting". Importantly, RBC added, Governor Macklem implied advance notice of a pending cut was not needed given the BoC's openness with its forecasts and indicators it closely tracks.

Meanwhile, in terms of the U.S., for BMO Economics the Bottom Line to today's Beige Book release is that the Fed's regional report card suggests the economy has "lost a step but continues to move forward", while inflation pressures continue to ease gradually. The report is far from the complete evidence that the Fed will need to ease policy, but it fits with Chair Powell's current timeline to cut rates "this year", BMO said. Powell provided that timeline in testimony earlier Wednesday.