That could be a setback to the focus upon containing inflation risk.
Markets are pricing another 25bps hike and part of another over coming meetings and may take a pause as a sign of wavering with the next move more likely to be down. Perhaps the strongest argument for hiking in July, however, is that a whiff could motivate easier financial conditions and a pile-on into the front-end relative to what is currently priced. Recent data has been somewhat mixed but generally supportive of hiking when coupled with a forward bias concerned about renewed upside risk to inflation and unmoored inflation expectations. This will be the final piece of the puzzle to be laid in place ahead of the following Wednesday’s statement, Monetary Policy Report and press conference to be delivered by the Bank of Canada. Key highlights for the week’s expectations are laid out below.Ĭanada updates jobs and wages for the month of June on Friday. Much of the week’s risk will be back-end loaded to Friday’s US and Canadian hopefully sizzling job market updates. The fact that this will also be a lighter than usual week for global calendar-based market risks doesn’t hurt. Enjoy your BBQs or however you plan to spend a well-deserved break. With the spirit of the holidays in mind, this issue of the Global Week Ahead is going to be a lighter one. Both occasions are likely to mean limited participation in global markets from clients across the northern two-thirds of North America until at least mid-week.
This weekend, Canada will celebrate its 156 th birthday since the British North America Act was passed on July 1 st 1867 with Monday being a statutory holiday, and then on Tuesday, the US will celebrate Independence Day that marks the Declaration of Independence that was ratified by Congress on July 4 th 1776.
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