Two of Canada's major banks forecast an......>

CANADA: Two of Canada's major banks forecast an above consensus print of 2.6%yy

(market median 2.5% prev 2.5%) for July CPI, released at 1230GMT. Energy price

growth seen boosting their outlook. CIBC comment that 'while the headline

inflation rate will reach its fastest pace in more than six years, it's not

reflective of an economy that is overheating. Indeed, ex-food and energy

inflation will only rise to 1.8%, well within the range it's been in since late

last year, while the Bank of Canada's

core common component measure of inflation should stick at 1.9% for the sixth

consecutive month. Forecast Implications - An only tepid advance in underlying

prices won't be forcing Governor Poloz's hand in September. More important to

the near-term outlook

for overnight rates will be incoming data on June GDP. 24% rate hike now priced

in for Sep5 BOC rate decision. RBC suggests watching resistance at C$1.3176

through the release, adding that a daily close above would be seen ending the

current corrective phase.