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Andrew Grantham
Executive Director, Economics
Podcast Series
Curve Your Enthusiasm

Bank of Canada preview

Ian and Andrew discuss their expectations for the Bank of Canada interest rate decision next week. The duo walk through the reasons why the Bank will need to hike by another 75.0bps next week, and look at the most likely path of short-rates over the rest of the year. Ian talks about his favorite trades going into the release, noting that the forward expectations for BoC policy are too flat. Andrew spends some time detailing his expectation of forecast changes in the MPR, while the pair spend time talking about the impact that a weaker Canadian dollar has on both CPI and the stance of policy.
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Podcast Series
Curve Your Enthusiasm

Highway to the danger zone

Ian and Andrew discuss the latest Canadian GDP numbers, noting how the deceleration in growth is coming from all the ‘wrong’ places when it comes to slowing inflation. Ian talks about how slowing growth impacts the yield curve, noting the differences between slowing from an above potential to a below potential rate. Andrew shares his view on the Bank of Canada rate decision next week, and provides the reasons why he thinks this is the final hike of the current cycle. The duo discuss what ‘higher for longer’ means, and the implications to how low policy rates can be cut in the next recession and why longer-term yields will be higher than most think.
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Podcast Series
Curve Your Enthusiasm

The strangest recession you ever did see

Ian and Andrew start the episode by discussing Friday’s data deluge, particularly the red-hot inflation reading in the United States. Andrew talks about the implications for Canada based on the drivers of U.S. CPI strength, noting that both the near-term peak and the end-of-year resting spot have now increased. The duo spend a lot of time talking about the options for the Bank of Canada, and introduce CIBC’s new forecasts for the target rate, which is higher as a result of the data. Ian talks about why CAD rates have been underperforming of late, and why he likes being long cross-market now. Andrew finishes the episode by looking at the odd type of recession he believes could transpire if rates are risen too high.
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Podcast Series
Curve Your Enthusiasm

The inflation episode

The scorching hot CPI report has created yet another shock for the market, and the probability of an even more ‘forceful’ response from the Bank of Canada seems warranted. In this episode, Ian and Andrew do a deep dive on the latest report and talk about the many methodology adjustments StatsCan is making to the basket. The co-hosts take some time to go over the new forecasts presented in the MPR from last week, and unveil CIBC’s new policy forecast. Ian discusses why back-end rates underperformed recently, as well as some of the risks to the Bank’s QT implementation.
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Podcast Series
Curve Your Enthusiasm

A hike too far?

In the 50th episode of Curve Your Enthusiasm, Ian and Andrew begin the show discussing the strength in the recent Canadian GDP numbers. Ian talks about data sensitivity and the bond market, while Andrew highlights why he thinks the path to terminal matters. The co-hosts both outline why they think the Fed is more likely to take short-run terminal above long-run neutral, and Andrew discusses the work he is doing on Canadian NAIRU. The proximity to the federal budget sparks a conversation with the duo, and Ian outlines his expectations for bond issuance in the year-ahead.
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Podcast Series
Curve Your Enthusiasm

Well that was anticlimactic

The Bank of Canada (BoC) hiked interest rates for the first time since 2018, and the episode begins with a dissection of the statement. This week, Ian is joined by Andrew Grantham, Senior Economist in CIBC Economics. Once the pair establish what was surprising from the BoC, they spend some time discussing why C$100.0 oil in 2022 has a different impact than C$100.0 oil in 2014. Andrew discusses his upside view on inflation, while also discussing the latest trends in provincial economics. Ian and Andrew spend some time talking about what impacts terminal rates, and ultimately agree to disagree.
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