Curve Your Enthusiasm Episode 55

Outflows or opportunity?

Ian is joined this week by Josh Kay, and the duo kick-off the episode discussing the Bank of Canada. With a 75 bps hike all but set in stone, the question is what should their next move be and should this matter given what is currently priced? Ian discusses his view on the ‘noncession/recession’ which will be challenging to trade, while Josh provides his view on what the move in rates means for credit markets. Josh discusses why credit outflows create opportunity for structural credit investors, and provides his view on sector trends in CAD IG. Ian finishes the show by given his outlook for rates and the curve.

22:26 min

Curve Your Enthusiasm Episode 54

Steal your face

Ian is joined this week by Jeremy Saunders, and the duo start the episode by looking at the shape of the Canada and U.S. yield curves relative to what is priced for monetary policy in each region. Ian discusses why he views the recent bond market rally to be technical, while Jeremy provides his take on why it has been more fundamentally based. Over the balance of the episode the team discuss the outlook for swap spreads, the inflection point for a Fed pivot, and why CDOR cessation should be a much less uncertain transition compared to the U.S. experience with LIBOR.

27:46 min

Curve Your Enthusiasm Episode 53

Break on through to the other side

Ian is joined this week by Paul Jenkin, and the duo kick-off the episode discussing their take of the FOMC meeting. The largest hike from the Fed since the mid-90s didn’t come entirely as expected, with a hawkish set of forecasts pitted against a dovish press conference. Paul discusses the reasons he expects policy rates to set higher than current market pricing, and what that means for bank portfolio behavior. The pair spend some time discussing asset-swap valuations, and what lower housing may mean for funding markets. Paul finishes the episode by providing his view on provincial spread valuations.

24:02 min

Curve Your Enthusiasm Episode 52

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.

33:04 min

Curve Your Enthusiasm Episode 51

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.

25:52 min

Curve Your Enthusiasm Episode 50

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.

23:52 min