TD Securities thinks there’s more room to run for the Bank of Canada as it increases interest rates from the pandemic lows.
In a note to clients Wednesday, TD Securities Chief Canada Strategist Andrew Kelvin raised his view of the terminal rate – the point at which the central bank will top out in the current hiking cycle – to four per cent from his prior call for 3.5 per cent, and said an even higher rate could potentially be in the cards.
“The BoC's hawkish ambiguity implies a wider range of potential terminal rates for Canada,” he said.
“We see anything from 3.50 per cent to 4.75 per cent as plausible, and think a four per cent terminal rate strikes a nice balance of maintaining BoC credibility and not unduly burdening the household sector.” # SANDI HALPERN # REAL ESTATE iNTEREST RATES # SOLD
Source: Bloomberg.ca
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