JPMorgan sees 'material risk' of full-point hike from Bank of Canada
BNN Bloomberg
The possibility of a full-percentage point interest rate hike from the Bank of Canada at its July meeting is now firmly on the table following the latest inflation data for May, according to strategists at JPMorgan
“The pace of inflation is clearly not letting up, and the [Bank of Canada] must demonstrate its resolve and move more aggressively, in our view, to tame inflationary pressures,” the strategists said in a report on Wednesday titled “Canada CPI: Get out the oven mitts.”
“We now see material risk that the bank will announce a 100 [basis point] increase in July.”
Statistics Canada reported Wednesday that consumer prices grew at the fastest pace in four decades at 7.7 per cent annualized in May. The price increases were broadbased but gasoline led the way with a whopping 12 per cent jump over the prior month. The May headline number was an acceleration from the 6.8 per cent increase StatsCan reported in April.
