On April 7, Andrew Grantham, an analyst at Canadian Imperial Bank of Commerce Capital Markets, said that although the market generally expects the Bank of Canada to keep interest rates unchanged at next week’s interest rate meeting, continued employment growth, low unemployment and high wage inflation mean that Policymakers are likely to stick to their bias toward raising rates rather than hinting at rate cuts, an expectation already priced in by financial markets.
Unemployment will rise moderately and wage inflation will ease, which should allow the Bank of Canada to keep policy on hold this year and not start cutting rates until early 2024.