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Fed Rates Shrug Off Bowman, CAD GDP Beat

STIR
  • Governor Bowman noting the housing rebound is affecting the Fed’s fight to lower inflation plus the earlier beat for Q1 CAD GDP haven’t been enough to lift Fed rate expectations.
  • Despite a latest small bounce, FOMC-dated OIS sits 0.5bp lower since CAD GDP for both Jun/July meetings and only modestly higher for subsequent meetings.
  • Pertinent cumulative changes from 5.08% effective: +14.5bp for Jun (-1bp on the day), +22.5bp for Jul terminal (-3bp on the day), -1bp for Nov (-5bp on the day) and -17bp for Dec (-4.5bp). Full run below.

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