Cry Havoc and Let Slip the Dogs of War. Chairman Powell and Co delivered a strong message that the war on inflation was not one the Fed would lose as they delivered a 75-bps rate hike today and signalled that 75-bps was on the table for July.  The Chairman also made it clear that rates […]

A Bond Play on the Rogers/Shaw Acquisition. In March 2022, Rogers issued bonds with an interesting clause referred to as Special Mandatory Redemption. If the merger is not concluded by December 31st, 2022, the bonds will be redeemed at $101. Shaw’s equity is roughly $5 below the takeout price, implying the market believes there is […]

Not On Autopilot – The Bank of Canada amidst the perfect storm. In yesterday’s speech (“the perfect storm”), Toni Gravelle, Deputy Governor of the Bank of Canada shared some insights into the BoC’s thinking. The policy rate needs “to be at neutral levels to help cool demand”, somewhere between 2-3%   We could see a […]

US CPI |Hotter Than Hoped. Although US CPI decelerated in April, it remains far too high: Headline CPI rose 0.3% (0.2% expected) leaving the annual rate at 8.3% (8.1% expected) Core prices rose 0.6% (0.4% expected) bringing the annual rate to 6.2% (6% expected)   Base effects will help annual CPI to fall, however a […]

Notes From the Desk | The Fed’s Playbook Leaked Unlike the Supreme Court’s abortion ruling, which was leaked in secret, the Fed’s playbook was leaked by Chairman Powell himself. Today’s meeting was fairly uneventful in that they raised the Funds rate by 50 bps and announced that Quantitative Tightening was commencing. The press conference was […]