Bank of Canada signals imminent rate hike

The Bank of Canada (BoC) this morning signalled clearly that it will begin hiking its key overnight interest rate at the next policy meeting in early June. We expect that rate to climb from 0.25% now to 1% by year-end, even as the Fed leaves US rates at near-zero. After that, we anticipate a slowdown in US GDP growth will persuade the BoC to move to the sidelines.

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