Markets

Canadian Market Outlook

GoCs have trimmed recent gains ahead of the FOMC announcement, with the market bracing for a shift in forward guidance, but mindful of the downdraft in inflation expectations associated with lower global growth and the plunge in crude oil. The positive skew for U.S. stock index futures has helped put a floor under yields although crude oil has remained defensive, weakening US$1.50. And concerns about Greece and Russia remain high.

The 10-year yield had firmed 1.5 bps to 1.765%, having rebounded from a 19-month low at 1.712% on Tuesday. And the 2s10s spread had widened 0.5 bp to +80 bps. Meanwhile, USD-CAD had firmed to the 1.1640 area, but was holding below Tuesday's trend peak at 1.1672. Canadian wholesale trade at 8.30 ET will likely be in the shadows of the U.S. inflation data and the FOMC announcement.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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