Bank of Canada Expected to Shift to Neutral Stance by Year End Despite Softening Growth and Higher Oil Prices

The Bank of Canada is expected to move to a more neutral stance by year-end, despite near-term growth slowing down. Scotiabank believes the slowdown is temporary and the central bank won't react to it. Additionally, Scotiabank doesn't expect the Bank of Canada to react to the direct impact of higher oil prices on inflation.