Bank of Canada looks set to cut rates next week on signs inflation tide turning
Investing.com -- Bets on the Bank of Canada pivoting to rate cuts next week received a major boost as data showing a significant dent to the economy and inflation suggests that higher rates are no longer needed.
The increased bets on a June rate cut were boosted by data Friday showing Canadian GDP unexpectedly to 1.7% in Q1, while the Q4 print of 1% was sharply revised lower to 0.1%.A deeper dive into Friday's GDP data showed several signs of underlying growth, ScotiaBank Economics said in a Friday note, "not least of which that growth in consumer spending is at its strongest in years and needs no help from rate cuts.
RBC, however, believes the slowing economic backdrop is"raising confidence that lower inflation readings will continue despite signs of a reacceleration in the stronger U.S. economy."
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