Free Trial

Long-Term Consumer Inflation Expectations Offer Comfort But New Short Term Highs

CANADA
  • Despite lower gas prices, consumer inflation expectations for 1Y and 2Y ahead continued to edge up (1Y 7.1%, 2y 5.2%) in the Q3 survey conducted Aug 2-23 with follow-up interviews Sept.
  • The 5Y ahead meanwhile fell back into its recent range as it pulled back from 4% (highest since 2Q18) to 3.44%, a move consistent with breakevens sitting close to pre-Ukraine war levels - chart.
  • The latter will be of some comfort for the BoC but further elevated short-term expectations and the risk they become more entrenched gives scope for the BoC to hang a hawkish argument on.

To read the full story

Close

Why MNI

MNI is the leading provider

of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.

Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.