Free Trial

US CPI Dominates BoC Hike

CANADA
  • Front GoCs have pared the additional gains through the BoC press conference but no more than that, and longer tenors are still holding richer since the presser.
  • The 2Y yield is still 2bp below initial announcement levels, despite only 19bp being priced beforehand and delivering a 25bp hike along with persistent excess demand language and upward revisions to forecasts. That’s for -13bp on the day with soft US CPI ruling the day (2Y Tsys -12bp).
  • Over the nearer-term, BAX futures have seen re-widening in inversion, with the Sep’23-Dec’24 spread widening from 65bp to 81bps today.
  • USDCAD meanwhile holds its earlier reversal of the push lower on the announcement, currently at 1.3187 off a low of 1.3144 that stopped short of testing the bear trigger at 1.3117 (Jun 27 low). CAD significantly underperforms peers on the day in that weak USD backdrop, conceding 1.2-1.3% to Antipodeans and more than 2% to Scandies.

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.