Bank of Canada Rate Hike Odds Now a Coin Flip for October 28

The Bank of Canada's recent string of interest-rate holds has come to an end as traders now see a rate hike as a coin flip for October 28, according to BNN Bloomberg.

Before the central bank's September decision, markets had priced in a 94% chance of another hold. However, this near-certainty has evaporated, with traders now seeing the meeting as close to a coin flip, tilted slightly towards a hike.

The shift follows the U.S. Federal Reserve's own rate hike on Wednesday, which was delivered to fight inflation south of the border.

Oil prices tied to the war in Iran are the biggest factor behind the shift, according to Claire Fan, senior economist at RBC. Bond market pricing works as a kind of consensus forecast for what the central bank will do, and right now it's reflecting worry that high fuel costs will feed into broader inflation.