Local Analyst Views Post CPI

Selection of analyst views post CPI, ranked by hawkishness in latest Bloomberg survey

• RBC: Easing inflation pressures draws BoC closer to the end of the hiking cycle. RBC continue to expect a 25bp hike in Dec to a terminal 4% but risks are still tilted to the upside. Breadth of inflation pressures continued to narrow, with 58% of the basket rising above 3% annualized over the last three months – still high, but down from a peak of 77% in July.
• CIBC: Expect another 50bp hike in Dec with the BoC having to rely on indicators of slowing growth, rather than immediate progress on inflation, to justify a pause in Q1. Still expect much lower inflation by 2H23 but need to first see downward pressure from on demand from softer job and income gains to make that happen.
• BMO: Official call of 50bps in Dec is under review but given that most measures of core inflation remain locked in a range around 5%, we continue to believe that overnight rates will ultimately need to go above 4% to eventually crack underlying inflation [had 4.5% terminal in Bloomberg survey yesterday].