DALY SEES 'NO URGENCY TO ADJUST THE POLICY RATE'

MNI BRIEF: Fed’s Collins Sees Rate Cuts Later Than Had Thought

MNI BRIEF: China March M2 Slows More Than Expected

MNI BRIEF: China Tightens Stock Market Supervision

MNI BRIEF: China Mar Exports Jump On Demand; Imports Improve

MNI: PBOC Sets Yuan Parity Lower At 7.0967 Fri; -4.87% Y/Y

MNI: BAKER HUGHES US RIG COUNT 617; OIL RIGS 506; GAS RIGS 109

March Home Sales Jumped At End Of Month

MNI BRIEF: Poilievre Calls QE 'Scam' And Would Limit BOC Remit

MNI: Growth Drag From Net Zero Carbon Goal Can Be Offset-OECD

MNI BRIEF: Lawmakers Signal Tough Hearing For BOC's Macklem

© 1982-2023 MNI. All rights reserved.
Terms | Privacy
Log Out
Free Trial

RBC On Favorable Opportunities For Long Canada vs US

CANADA

RBC see the BoC hiking 50bp at each of the next two meetings before downshifting to 25bp clips to get rates to the neutral mid-point of 2.5%.

  • Rates should peak across the curve in Q2 and see modest flattening pressures with the belly and long end (5-30y) more downwardly biased than the front end (2y), less so than in the US.
  • They see breakevens remaining anchored in the short term, but falling over the course of the year.
  • BoC terminal rates are seen 50bp below the Fed. However, the 5y5y spread has exploded higher in the past couple of months; it is close to historical highs and very dislocated for a coordinated BoC/Fed tightening cycle. Some of the move can be attributed to investors stopping out, but those with a long-term horizon should be rewarded from receiving CA-US.
BulletMarketsFixed Income Bullets Bank of Canada Market NewsHomepage
BulletMarketsFixed Income Bullets Bank of Canada Market NewsHomepage

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.