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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.
Source: Bank of Canada
EXECUTIVE SUMMARY
- The BoC is seen having a close decision between hiking this week or waiting five weeks until July. Consensus leans to no change although market pricing has increased to 50/50 chance of a hike and we edge into the hike camp this week.
- It comes down to the strength of domestic data vs the timing of BoC commentary with the far more thorough MPR landing with the July meeting and the recently emerged Fed skipping narrative.
- We expect hawkish language in the single page statement either way, but outright market reaction is likely larger in the event of a dovish surprise.
- There is circa 40bps of hikes priced to October from current levels and a large higher rates for longer push has seen Canada 2Y OIS exceed that of the US for the first time since Sep, whilst there has also been an apparent sizeable trimming of CAD net shorts.
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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.
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