Loonie flight to quality remains on course
MARKET VOICE
In its sixth 25 basis point rate hike of the present tightening cycle, the Bank of Canada (BoC) stuck with the same wording of its mildly hawkish tone, indicating the need for further tightening.
With the overnight rate at a 4.5-year high of 3.50%, the real overnight rate has climbed to 1.9%, relative to the annual core inflation rate of 1.6%. This is the highest real overnight rate since August 2001, and the first time that the real rate has exceeded the core rate over a similar period.
Escalat
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