The seeming ability of a number of banking organizations to make consistent profits from foreign exchange trading likely derives not from their insight into future rate changes but from making markets and consistently being able to buy at the bid and sell at the offering price, pocketing the spread.
The Bank continues to judge that the Canadian economy is operating at its production capacity and will grow roughly in line with its production potential through 2007. Annual GDP growth is expected to be 3.1 per cent this year and 2.9 per cent in 2007, with strong growth in domestic demand and further gains in exports.