The Bank of Canada maintained its overnight interest rate at 1% today (Wednesday), cut its 2013 economic growth forecast to 1.5% from 2%, and raised its 2014 economic growth forecast to 2.8% from 2.7%.
You can watch BOC Governor Carney's subsequent press conference at this video link. I found his response to this question from a member of the press rather "curious." When asked, "What can you say about the plunge in the price of gold this week?" he responded with "It's not a market that we follow closely." (I have to give him credit for holding a straight face while gave his answer...however, Senior Deputy Governor Macklem, to his right was not quite so skilled.) He went on to say that they (BOC) were more interested in a variety of other commodities (he mentioned oil and lumber) as being more indicative and leading indicators of global growth prospects, and that one could point to the base metals in that regard.
As I write this at 10:30 am EST, most of the commodities in my list are down and Canada's TSX Index is down 103.21 from yesterday's close. Most world market indices are also down.
Continued weakness in commodities may, finally, weigh negatively on equities, as I've written in several posts recently here, here, and here.
UPDATE at 4:30 pm EST - As an example of a base metal that they are likely monitoring, copper is down nearly 4% today and is currently trading at 3.1765. Contrast that with its high of 4.6495 reached in February 2011, and it's down by 32% from that level. The chart below shows that a bearish "Death Cross" has formed recently on the Weekly timeframe as price has fallen below 5-Year major price, moving average, Fibonacci, and volume support levels....one to watch going forward, along with other commodities that I've mentioned in the above referenced (and even older) posts.
World Market Index Source: http://www.indexq.org/
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BOC Maintains Interest Rate And Lowers 2013 Forecast
Published 04/17/2013, 02:37 PM
Updated 07/09/2023, 06:31 AM
BOC Maintains Interest Rate And Lowers 2013 Forecast
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