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Inflation expectations too high for the Bank

The falls in commodity prices this week point to some relief ahead for CPI inflation, but the Bank of Canada will be more focused on the rises in long-run inflation expectations and wage growth in the latest data, prompting a larger 75 bp interest rate hike next week. Canada Drop-In (13th July): We’re holding a briefing on the Bank of Canada decision shortly after the Wednesday 13th policy announcement. Register to join our discussion about how fast and far rates will rise, housing market risks and the outlook for the loonie. Register now.

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