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June BoC Cut Swings Back Into Focus On CPI Miss, USDCAD Respecting Resistance For Now

CANADA
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  • With the dust settling on what looks like a firmly dovish CPI report, there is now ~20bp of a first cut priced for the June decision whilst July has seen 10bps added to a cumulative 35bps.
  • USDCAD touched 1.361 but there does seem to be some staying power around the bull trigger of 1.3606 (1.3606 (Feb 28 high). Next resistance is seen at 1.3623 (Fibo retrace of Nov 1 – Dec 27 bear leg).
  • 2Y GoC yields sit 11.5bps lower post-data for 13.5bp lower on the day, with the Can-US differential falling 10bps to -54bps.
  • 3-mth CORRA futures currently see implied yields some 18.5bp lower on the day for Dec’24/Mar’25 contracts.
  • CORH4/Z4 has pushed to -81bps vs -68bps pre-CPI and -88bps before the Mar 6 BoC.
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  • With the dust settling on what looks like a firmly dovish CPI report, there is now ~20bp of a first cut priced for the June decision whilst July has seen 10bps added to a cumulative 35bps.
  • USDCAD touched 1.361 but there does seem to be some staying power around the bull trigger of 1.3606 (1.3606 (Feb 28 high). Next resistance is seen at 1.3623 (Fibo retrace of Nov 1 – Dec 27 bear leg).
  • 2Y GoC yields sit 11.5bps lower post-data for 13.5bp lower on the day, with the Can-US differential falling 10bps to -54bps.
  • 3-mth CORRA futures currently see implied yields some 18.5bp lower on the day for Dec’24/Mar’25 contracts.
  • CORH4/Z4 has pushed to -81bps vs -68bps pre-CPI and -88bps before the Mar 6 BoC.