Overnight index swaps increased hawkish bets for further BoC tightening this year after Canada reported higher than expected August inflation
Headline Aug. CPI printed at 4.0% Y/y; est. 4.8%, gas prices increased on the month for the first time since January, core inflation accelerated vs the prior month
The December ON index swap tenor is now pricing 20bps of tightening by the BoC, this is compared to 14bps on Monday. BoC pricing sees no cuts for next year
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