Sprinting Towards Neutral

As we’ve been revising inflation forecasts higher in recent months and given that central banks are behind the curve, we have adjusted our views for rates two-fold. First, we believe that we are currently in a shock treatment phase, which will see more supersized hikes and the start of quantitative tightening. In fact, we currently expect the Bank of Canada (BoC) to deliver a 75 basis-point hike in June.