MNI BoC Review-March 2026 - Leans Dovish In Energy “Dilemma”

Download Full Report Here: https://media.marketnews.com/BOC_Review_Mar2026_64dbea8d5d.pdf EXECUTIVE SUMMARY - BOC Leans Dovish In Energy "Dilemma" * The Bank of Canada's March meeting came with the overwhelmingly expected rate hold (overnight rate at 2.25% for the 3rd consecutive meeting), as well as the anticipated focus on the new risks presented to the outlook from the conflict in the Middle East. * In our view, while the overall messaging on rates was largely neutral, the BOC's take on the impact of higher energy prices leans slightly dovish. The communications emphasized downside risks to growth, and Gov Macklem mused that without the energy price shock and associated inflationary pressures, the BOC might have been talking about cutting rates this year given weaker-than-expected growth and soft labour market data. In some ways that vindicated inter-market market pricing which ended February pricing in a slight easing bias through year-end on the back of softening data, but now prices in a hike by year-end. * The press conference emphasized that the BOC would take its time to assess the war's impact, and while it would look through near-term headline inflation increases, it would be looking carefully at core metrics to gauge whether there was an impact on broader price pressures. Macklem said "I don't think you measure this in weeks", but the current assessment is that "the risk that higher energy prices are going to quickly spread to other goods and services looks contained" due in part to excess supply in the economy. * Markets took the meeting fairly neutrally, with a slight dovish move in the June and July meeting-dated OIS implied rates, though volatility was more attributable to actual developments in the Middle East/energy prices on the day than to the BOC itself. At the conclusion of the press conference there were around 28bp of hikes priced through 2026, vs around 30bp prior to the decision, with a 25bp hike seen roughly by the October meeting. See PDF report for: * MNI View * MNI Instant Answers * Press Conference Transcript * BOC Meeting Links * Policy Statement Changes

MNI BOE Preview: March 2026 - Hold now, what's next?

The main focus will be on the Bank's updated guidance, the vote split and individual member paragraphs - we look at each

MNI BoJ Preview-March 2026: On Hold As War Complicates

EXECUTIVE SUMMARY: * The BOJ is expected to hold rates in March, adopting a cautious stance as the "war in Iran has complicated the BoJ's outlook," reversing earlier signals that "the distance to the next rate hike was narrowing." * Governor Kazuo Ueda highlighted two-sided risks from energy prices-near-term "downward pressure on the economy and the underlying inflation rate" but longer-term upside via "inflation expectations"-with the BOJ set to "closely monitor the Middle East situation" while maintaining a tightening bias. * Domestic conditions remain broadly supportive, with wages and inflation suggesting "reflation dynamics remain on track," though policymakers are likely to wait for wage confirmation; oil shocks could either reinforce inflation or create "stagflation risks," complicating the outlook. * Markets price around a 60% chance of an April hike, but timing remains uncertain (April-July most cited), with decisions hinging on oil prices, yen weakness, wage data, and growth; overall, the BOJ is expected to proceed gradually, balancing inflation risks against growth and financial stability. FOR THE FULL PUBLICATION PLEASE USE THE FOLLOWING LINK:BOJ Preview - Mar 2026.pdf: https://media.marketnews.com/BOJ_Preview_Mar_2026_6deb49eff2.pdf

MNI BoC Preview-Mar 2026: Oil Shock Meets Soft Data

Download Full Report Here: https://media.marketnews.com/BOC_Preview_Mar2026_c73d15d436.pdf EXECUTIVE SUMMARY: * The Bank of Canada is overwhelmingly expected by both markets and analysts to maintain its overnight rate for a 3rd consecutive decision at 2.25% at the March meeting (announcement on Mar 18). * The main point of interest for the meeting communications is how Governing Council views the risks to the economic outlook posed by the war in the Middle East that has broken out since the prior meeting in January. * Domestic economic developments would have appeared to argue - if anything - for further easing, and indeed as of February 27 (even before the soft February data releases) there were about 8bp of cuts priced in OIS by the end of 2026, vs 8bp of hikes a month earlier. * But the conflict in Iran sharply increased expectations of hikes: on the eve of the March rate announcement there are currently ~33bp in 2026 hikes priced, down slightly from the 40bp seen late last week (with February's soft CPI and jobs reports helping tame the case for hikes). There are no longer any analysts who expect the BOC to cut rates this year, though most see hikes starting only in 2027. * As with other major economies, the spike in energy prices in March is inevitably going to push up headline CPI and spread into core prices, with a negative impact on consumers. Unlike other major economies, however Canada's status as an energy exporter means the growth impact is seen as positive on net, due in large part to better terms of trade, which adds an additional complication for the BOC's assessment of the economic trajectory. * Given the fluid situation in the Mideast, the BOC's "wait and see" approach, with an expression of optionality to move rates in either direction, is likely to persist. * MNI's Instant Answers looks for any clearer signs on rate intentions, including whether the Bank signals it is prepared to lower, raise, or hold rates in future.