{"id":471153,"date":"2010-03-25T10:02:00","date_gmt":"2010-03-25T14:02:00","guid":{"rendered":"e2249889-c78b-43e3-9643-b1d7d4aa587b:413230"},"modified":"2010-03-25T10:02:00","modified_gmt":"2010-03-25T14:02:00","slug":"bank-of-canada-rate-hike-expected-on-june-1","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/471153","title":{"rendered":"Bank of Canada rate hike expected on June 1"},"content":{"rendered":"<p>Foreign exchange strategists at Citigroup Global Markets Inc. say interest rate expectations in Canada \u201chave accelerated significantly,\u201d based on strong economic data and the subtle shifts in comments Wednesday from Bank of Canada governor Mark Carney. As a result,<a href=\"http:\/\/www.financialpost.com\/news-sectors\/story.html?id=2724780\" > the Canadian dollar<\/a> has room to grow and represents a \u201cfavourable risk-return\u201d for investors, Citigroup said in a note to clients Thursday.<\/p>\n<p>In a luncheon speech Wednesday, <a href=\"http:\/\/www.financialpost.com\/story.html?id=2723025\" >Mr. Carney said<\/a> inflation was \u201cslightly firmer\u201d than expected, and reinforced that his pledge to keep record-low interest rates until July was \u201cexpressly conditional.\u201d<\/p>\n<p>As a result, Citigroup strategists said Thursday they expect the first Bank of Canada benchmark rate hike since 2007 to unfold at the central bank\u2019s June 1 statement, with an increase of 25 basis points. Afterward, they also expect 25-basis-point hikes at each Bank of Canada statement for the remainder of 2010, which would lead to a benchmark of 1.5% by the end of 2010.<\/p>\n<p>In terms of currency implications, expect this, they say:<\/p>\n<p>\u201cSince the relationship between USD\/CAD and expected interest rate spreads has reasserted itself in recent months following a breakdown during earlier phases of the crisis, this likely spells a sustained drop beneath parity. We favor selling into USD\/CAD rallies.<\/p>\n<p>\u201cOf course, sentiment on CAD has been strong for some time and positioning would seem to present a significant threat to our positive outlook. &#8230; Still, records are made to broken and, as of yet, investors are <br \/>not behaving as if CAD longs have reached capacity.\u201d<\/p>\n<p><a href=\"mailto:pvieira@nationalpost.com\">Paul Vieira<\/a> <\/p>\n<p><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/network.nationalpost.com\/NP\/aggbug.aspx?PostID=413230\" width=\"1\" height=\"1\"><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Foreign exchange strategists at Citigroup Global Markets Inc. say interest rate expectations in Canada \u201chave accelerated significantly,\u201d based on strong economic data and the subtle shifts in comments Wednesday from Bank of Canada governor Mark Carney. As a result, the Canadian dollar has room to grow and represents a \u201cfavourable risk-return\u201d for investors, Citigroup said [&hellip;]<\/p>\n","protected":false},"author":4059,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-471153","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/471153","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/users\/4059"}],"replies":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/comments?post=471153"}],"version-history":[{"count":0,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/471153\/revisions"}],"wp:attachment":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/media?parent=471153"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/categories?post=471153"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/tags?post=471153"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}