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Canada Rate Hikes Being Pulled Forward

STIR FUTURES
  • Partially mirroring the moves seen in the US, BAX futures are down 3 ticks through middle whites whilst there is growing inversion in the greens.
  • With implied rate hikes being pulled into 2022 (crudely more than 6.5x25bp), the Z2-Z3 spread struggles to break out of its recent range of 40-45bps.
  • The next main Canadian drivers are on Wed with Jan CPI (0830ET) and BoC’s Lane (1330ET).
  • In the interim in the US, of those scheduled, there is the U.Mich consumer survey shortly, Biden holds a calls with Transatlantic leaders on Ukraine (1100ET) and Bullard is pencilled in to speak again on Monday morning (0830ET).

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