Worthwhile Canadian Initiative: Why would the Bank of Canada reduce interest rates on December 4?

The last time the Bank of Canada announced its target for the overnight rate, it decided to keep its previous level of 4.5%, and it said that that it was planning on keeping that rate for at least the next few months. It's been a month since then; is there any reason why the Bank would revisit that policy? Let's look at the relevant facts:

Inflation is coming down, but perhaps not far enough for the Bank to decide that it's no longer worth worrying about. Core inflation in September was at 2% y/y, but it's been above 2% for a couple of years now.
Employment growth continues to outstrip that of the working-age population. Employment rates are at an all-time high.
The Bank's measure of the output gap in 2007Q3 was positive, as it has been for well over a year.
The exchange rate is pretty much where it was on October 16.

That last point deserves some comment. Here is a graph of the CAD-USD exchange rate since October 16:

The last few weeks has seen any number of panicky demands for an immediate intervention to bring the CAD back down, and not a few people calling for monetary union with the US. But all it really took to bring the CAD back to earth was the release of the September trade balance data.

If the decision were to be made today, I would expect the Bank to keep the target at 4.5%, with perhaps a hint that they would be prepared to cut interest rates in January if inflation continued to drift down, and if inflationary pressures continued to ease. If the October inflation numbers (due to be published Tuesday) or the 2007Q3 GDP numbers show a significant weakening, then the hints of a January rate cut will be more strongly worded.

But the strongest reason why we should not expect a rate cut in December is that the Bank told us not to expect one. And the Bank's announcements of future intentions are a very good predictor of what it actually does.