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“People are starting to get the view the Bank of Canada is certainly not going to be raising rates, but might actually turn more dovish or even open the door to rate cuts,” said David Watt, chief economist at the Canadian unit of HSBC Holdings Plc, by phone from Toronto. “You’re getting to the sell-Canada kind of story.”

In fact, some are looking for the bank to cut rates. Mark Chandler, Head of Canadian FIC Strategy at RBC Dominion Securities observes that “there is a significant minority of observers believing that a shift towards an easing bias is in the cards next week and, unless the notion is dispelled, it is hard to imagine the Canadian dollar reversing some of its recent losses.”

Traders also awaited the afternoon release of the latest take on the economy by the U.S. Federal Reserve. The Fed has already started to taper its massive monthly bond purchases to $75 billion, a decrease of $10 billion a month, and made further tapering contingent on economic performance, particularly jobs data.

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Uncertainty about Fed intentions arose after December jobs data released last Friday came far below expectations.

In other economic developments, the World Bank said Tuesday that the global economy is slowly picking up steam.

The bank’s twice-yearly Global Economics Prospects report says global growth is expected to firm from 2.4 % in 2013 to 3.2 % this year and 3.4 % in 2015. The report said the momentum that countries such as the United States and Japan are building up should support stronger growth in the developing countries.

On the commodity markets, February crude on the New York Mercantile Exchange gained 44 cents to US$93.03 a barrel.

March copper declined one cent to US$3.32 to US$ a pound while February bullion lost $6.40 to US$1,239 an ounce.