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GoCs And Rates At Odds, Macklem Later

CANADA
  • GoCs are back near yesterday’s highs in the front-end following the US data. Yields are up 0.5-3.5bps across the curve for a modest bear steepening on the day, a small move with 2YY -28bps and 10YY -21bps from Fri highs.
  • Rates look through the data though: BAX futures are still up 6-7 ticks in back whites/front reds but with little change over immediate meetings as OIS roughly prices a 50bp hike for June and a cumulative 95bps for July.
  • Macklem speaks at the Senate late today at 1830ET, unlikely to add to the steering towards another 50bp hike from Monday’s House version but it can’t be ruled out.

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