Local Analysts Tilt To A BoC Hike Next Week

Analysts are increasingly calling for a 25bp hike at Wednesday's decision whilst OIS pricing still lags despite a 1.5bp increase to +18.5bp since the jobs report.

• BMO: This is a solid report overall even if it has some blemishes. The big headline increase and ongoing strength in the labour market likely tilts the balance toward another 25 bp hike at next week's BoC policy announcement.
• CIBC: The jobs data were no slam dunk for the BoC, with a rise in the unemployment rate and slowing wage growth suggesting that labour market conditions are loosening. However, the data are probably just strong enough to see policymakers pull the trigger on another 25bp hike next week, rather than wait until September as we had previously forecast. We still think that 5.0% will prove to be the peak, as evidence that the economy is slowing appears to be mounting.
• RBC: The June labour market data was mixed but shouldn't be enough to prevent the BoC from following through with a second straight 25 basis point interest rate hike at the next policy decision next week.
• TD: While [a sharp deceleration in wage growth was] eye-catching, we do not think this will be enough to derail another 25bp hike in July, especially with the strong pace of full-time job growth. Today's report should help to seal the deal for a rate hike next week.