Bank of America Global Research discusses its expectations for tomorrow's BoC policy decision.

"We expect the Bank of Canada (BoC) to remain on pause with the overnight rate at 4.50% on 12 April. Inflation remains high, but both headline and core are falling. The labor market remains tight, but it is slowly softening. We have the BoC on hold for the rest of the year. Upside risks in the short term remain as inflation is still high and the Fed is still hiking. Risks for the BoC to switch to the downside towards the end of the year remain as the economy decelerates," BofA notes.

"Myriad reasons for a hawkish forward guidance at this meeting should be bullish for CAD, but price action may be mixed given US CPI release on the same day. We continue to expect CAD to strengthen against USD over the medium-term," BofA adds.