Canada’s BOS critical in shaping BoC’s opinion

The Spring 2015 edition of the Business Outlook Survey (BOS) is out today and it is seen as critical in shaping the BoC's opinion on further cuts.

In the Winter survey, the fall in oil put downward pressure on the hiring plans and machinery & equipment (M&E) investment intentions measures, with the accompanying comments noting a material divergence in sentiment between firms tied to the oil and gas sector (more negative) and those more exposed to a firming US outlook (more positive). 

"Oil prices have fallen further since the Jan survey and we expect further signs of weakness", says RBC Capital Markets

The key will be to what degree non-energy investment is prepared to pick up the slack. There is a 20% chance of a cut priced in for next week's FAD but a surprising survey could tip that either way.