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Initially Muted Reaction To CAD CPI Slowly Builds

CANADA
  • BoC-dated OIS has dipped ~2bps to +15bp for the Jul 12 decision.
  • Front end GoCs have started to extend the initial 1bp rally for now -2.5bps on the release (-1.5bp on the day) and modestly outperform Tsys. 2s10s have steepened 2.5bps post-data but are still some -129bps.
  • USDCAD briefly touched a high of 1.3177 which remained within yesterday's range and is currently back close to pre-data levels in the mid-1.316s.
  • Next major local releases land on Friday with the Business and Consumer BoC surveys as well as monthly GDP.

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