Four More Years. Biden nominates Jay Powell for a second term. · Jay Powell to serve a second term as chair of the Federal Reserve. · Lael Brainard, considered the competitor to the throne, assumes the role of vice-chair and is expected to be named vice-chair of supervision (oversees the US banking system). · This […]

Canadian Inflation · Headline CPI came in as expected at 4.7%, while core inflation was 1.8% (a touch below the expectation of 1.9%) · With the Bank of Canada forecast of 4.8% for Q4, today’s numbers should do little to ease concerns over inflation nor should it stoke these fears further · The market is […]

Today’s FOMC was a relatively straightforward, as-expected affair. · The tapering of QE begins this month with a reduction of $15 bn per month ($10 bn in treasuries, $5 bn in mortgages) · At this pace, QE will be done in mid-June, which sets the stage for rate hikes in the second half of 2022. […]

A quick note from our trading desk on today’s Bank of Canada meeting and press conference. · The BoC has officially ended QE and moved into the reinvestment phase, where they will simply reinvest maturing bonds. They expect to be in this reinvestment phase until at least the first rate hike. · Forecast for the […]

Federal Reserve Chairman Jay Powell has achieved an amazing outcome. His highly anticipated speech this morning was a masterpiece of optimism and calmness. · Tapering is expected later this year, with the exact timing dependent on the impact of delta. No panic in bonds and equities make new highs. · Hiking is not on the […]