Market bets on another jumbo interest rate hike in June

Trading in overnight swaps show investors are now fully pricing in a second 50-basis-point increase at the central bank’s June 1 meeting. Odds for the second outsized rate hike next month rose to 100 per cent on Wednesday for the first time, after annual inflation blew past expectations.

Markets are now in line with a majority of Canada’s lenders. Canadian Imperial Bank of Commerce and Laurentian Bank of Canada switched their calls to a 50 basis point hike after the inflation report. Toronto-Dominion Bank, Bank of Nova Scotia and Bank of Montreal were already predicting an outsized rate increase in June.

“We think the Bank of Canada will be concerned that inflation continues to surprise to the upside of their forecasts,” Andrew Grantham, an economist with CIBC, said by email. “They’ll want to make sure that these strong inflation readings don’t start to impact longer-run inflation expectations.”Article content

Statistics Canada reported Wednesday that inflation rose to 6.7 per cent in March, the highest since January 1991. Economists were anticipating inflation would hit 6.1 per cent. Bank of Canada Governor Tiff Macklem increased the benchmark overnight interest rate by 50 basis points to 1 per cent last week, and reiterated he would “act forcefully” to wrestle inflation back to the central bank’s 2 per cent target.

Business Business Latest News, Business Business Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Canadian IPO market freezes for tech firms in first quarter of 2022Not a single innovation\u002Deconomy company went public via an IPO in the first quarter of 2022
Source: nationalpost - 🏆 10. / 80 Read more »

Single income Sudburians wanting to enter housing market feel jilted by rising prices | CBC NewsFirst-time homebuyers in Greater Sudbury are finding it difficult to enter a market with shrinking supply and rising prices. Do you know you can make $8,000 💰💰💰in every 5 working days with Tritisinvestment platform ? Contact the Agent 📲 +1 (601) 791-1081 Canada is ultimately a massive failure at producing a high functioning population and economy and can only survive by taking in massive amounts of foreigners who have been raised with traditional values and education. seriously? I see two in that very picture
Source: CBCNews - 🏆 2. / 99 Read more »

Housing market slowing rapidly amid interest rate hikesICYMI: Housing market slowing rapidly amid interest rate hikes — via financialpost Housingmarket RealEstate Mortgages Economy financialpost Save your down payment for when it collapses then interest rates go down again! You'll have your opportunity
Source: nationalpost - 🏆 10. / 80 Read more »