Tightening bias will soon become unnecessary

The outgoing Governor Carney's last scheduled statement next week (May 29th) is unlikely to hint at any shift in policy. Nor do we believe that his replacement Stephen Poloz, due to take over next month, will make any immediate changes. But the Bank's tightening bias will soon prove unnecessary and we still believe that, if there is to be any change in the policy interest rate over the next 12 to 24 months, it would be to lower rates, not raise them.