• Notes from the Desk | Canadian Inflation - A Glimmer of Hope

Notes from the Desk | Canadian Inflation – A Glimmer of Hope Sept 20 2022

Notes From The Desk: Canadian Inflation – A Glimmer of Hope

Canadian inflation slowed in August, with headline CPI coming in at 7% (7.3% expected) as lower gasoline prices offset rising food costs.

The closely watched average of the three core measures also slowed from 5.4% to 5.2%.

Today’s data reinforces the market expectation that Canadian overnight rates need not go much higher than the 3.75-4% range, which allows short-end yields to drop a bit.

Furthermore, with the cross-border divergence in inflation and employment trends, the terminal rate in Canada is likely to be lower than in the US.

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