Economics

Markets have thrown down their 50 basis point chip on the poker table, betting that the Bank of Canada will deliver an interest rate cut of that magnitude next week. But will the central bankers call that bet, or raise to 75?

What do the latest inflation numbers mean for the path of rate reduction? CIBC Senior Economist Andrew Grantham gives us his insights.

With a US election only weeks away, fixed income investors need to give some thought to how its outcome could impact theFed’s decisions in 2025.

CIBC’s President and CEO, Victor Dodig, sits down with Harry Culham, SEVP and Group Head, CIBC Capital Markets and Direct Financial Services for an in-depth conversation around our current market conditions, where they see things going, and how CIBC operates in an evolving and dynamic economic environment.

The American labor market looked like it reached a breaking point, and then it didn’t. The September jobs report and the recent revisions to income and the saving rate have provided plenty of ammunition to the no landing camp. But don't get too caught up in one report. The economy does not move in a straight line.

Markets are being driven by the disappointing Chinese economic planning briefing post Golden Week, in which only 200 billion yuan in spending was announced vs expectations for trillions

Global equities are slightly lower while front end rates have continued to sell off as the market reassess the pace of easing in the wake of September payrolls and rising oil prices.

Ian is joined by two guests this week, Paul Beaudry (Professor of Economics at UBC and Former Deputy Governor of the Bank of Canada) and Ali Jaffery from CIBC Economics. The episode begins with Paul giving his view on the 50.0bps cut from FOMC, and what the most recent strong NFP means for the November meeting (hint: 25.0bps not 50.0bps). In contrast, when thinking about the Bank of Canada, Paul outlines his views that the preconditions for getting administered rates to a much lower are setting have been met for Canada, and provides his views for the October meeting (hint: 50.0bps, not 25.0bps). Ian discusses the need for a smaller balance sheet, while Ali gives an update on what higher energy prices mean for the BoC reaction function.

So you might think that by now, economists and central bankers would have a good handle on the trade-off between slack and inflation. You would be wrong. The debate about how much slack is enough to cure high inflation, or whether inflation expectations dominate, is far from settled...

In Q3 2024 Canadian bank, corporate, and maple bond issuance totaled ~C$29.9 billion, marking the second busiest Q3 on record and ~20% higher than the 5-year historical Q3 average.

Global equities are rangebound to slightly lower overnight, while oil is slightly higher as geopolitical tensions simmer but have yet to escalate.

Data revisions can be an economist’s friend or foe, depending on whether they enhance or negate the facts you’ve been drawing on to support your outlook...

Chinese equities have continued to rally in the wake of the recently announced stimulus program; elsewhere global equities are broadly rangebound to slightly lower.

CIBC Chief Economist Avery Shenfeld is joined by Dr. Richard Clarida, Managing Director & Global Economic Advisor, PIMCO, who shares his perspectives on the US outlook, the direction for the Fed, and the implications for markets.

Overnight EUR/USD and GBP/USD are lower on weaker than anticipated PMI data (Eurozone Manufacturing at 44.8 vs. consensus at 45.7, UK manufacturing at 51.5 vs. consensus at 52.2).

Like everyone else, when the US Federal Reserve policy committee prints its new forecasts, our eyes jump right away to the median responses. But what differentiates the Fed from the Bank of Canada is that the committee shows the full distribution of the projections of its members, and there’s meaning beyond the median if you take the time to look at the range of individual forecasts.

While Powell’s press conference veered on the more hawkish side (in context of the outsized rate cut delivered), we are seeing a strong rally in the equity market (S&P futures +1.5%) in anticipation of further cuts to come.

Ahead of the widely anticipated start of the Fed’s easing cycle, US equity futures head into the open slightly bid, and the USD is widely offered against other G10 currencies.

As rates drop, what is on the horizon for the US Economy? CIBC Chief Economist Avery Shenfeld shares his thoughts.

As rates drop, what is on the horizon for the Canadian Economy? CIBC Chief Economist Avery Shenfeld shares his thoughts.