Canada Inflation Steady at 3%, BoC Rate Hike Expectations Rise
Canada's Consumer Price Index (CPI) figures for August will be released on Monday at 12:30 GMT, and markets are expecting steady inflation. According to economists, the headline CPI is forecasted to remain unchanged at 3% YoY and rise by 0.3% MoM, below July's 0.5% increase.
The Bank of Canada (BoC) kept interest rates steady at 2.25% in its September 2 meeting, which was broadly in line with analyst consensus. The BoC's core measure is expected to rise by 0.1%, while the preferred gauges of underlying inflation picked up pace in July.
Market participants are expecting nearly 36 basis points of tightening by year-end, and if inflation adds to the recent uptick, bets on further rate hikes should increase, providing fresh legs for the Canadian Dollar (CAD).