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MNI BoC Review, Jul'22: "Very Unusual" Indeed

Source: Bank of Canada

Bank of Canada Governor Tiff Macklem

EXECUTIVE SUMMARY

  • The Bank surprisingly hiked 100bp to the 2.5% neutral mid-point (bit over 80bps priced), ‘front-loading’ to reduce the risk of high inflation becoming entrenched and requiring a greater economic cost to combat it.
  • Governor Macklem offered in the press conference that the Bank sees getting the policy rate to the top or slightly above the upper neutral estimate of 3% but will take each meeting as it comes
  • Analysts see higher risk of another very large hike in Sept (OIS 65-70bps) with two key CPI reports before then, but only small changes to prior above-terminal rate calls whilst deciphering the new guidance.

PLEASE FIND THE FULL NOTE HERE:

BOCReviewJul2022.pdf

Central Bank ReviewHomepageBoC - ReviewCentral Bank ReportsMarkets Bank of Canada Market News
Central Bank ReviewHomepageBoC - ReviewCentral Bank ReportsMarkets Bank of Canada Market News

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