BOC’s Carney to hike rates

The first monthly decline in Canada’s employment this year failed to dissuade bond traders from expecting another interest-rate increase by the Bank of Canada next month, though the chances are diminishing.

The odds of a 0.25 percentage point boost stood at 60 percent after the jobs report on Aug. 6, Bank of Nova Scotia data showed. In the days before the report, probabilities ranged from 62 percent to 68 percent. Bank of Canada policy makers next meet to decide monetary policy on Sept. 8.

“Despite the Canadian job losses, Canada’s economy has added more than 200,000 jobs over the past six months, with the unemployment rate down significantly from its recessionary peak,” Mohammed Ahmed, a Toronto-based rates strategist at Canadian Imperial Bank of Commerce, said in an interview.

A September increase may likely be the last this year. Chances of a boost at the central bank’s October and December meetings fell to 30 percent, from almost 40 percent earlier two weeks ago, the Bank of Nova Scotia data showed.

Bloomberg

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Dean Popplewell

Dean Popplewell

Vice-President of Market Analysis at MarketPulse
Dean Popplewell has nearly two decades of experience trading currencies and fixed income instruments. He has a deep understanding of market fundamentals and the impact of global events on capital markets. He is respected among professional traders for his skilled analysis and career history as global head of trading for firms such as Scotia Capital and BMO Nesbitt Burns. Since joining OANDA in 2006, Dean has played an instrumental role in driving awareness of the forex market as an emerging asset class for retail investors, as well as providing expert counsel to a number of internal teams on how to best serve clients and industry stakeholders.
Dean Popplewell