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Rate Path Continues To Rise Ahead Of FOMC

CANADA
  • BAX implied yields continue to rise ahead of the FOMC, led by late whites/front red yields up as much as 9bps.
  • It pushes the mid-2023 peak back to highs from two weeks ago, crudely implying an overnight rate a little above 3.25% vs the BoC’s 2-3% neutral range estimate.
  • The curve is increasingly front-loaded compared to then though, now with an additional 50bp of hikes through U2-M3 vs the path after the BoC hiked 50bps at the Apr’13 decision.

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