Bloomberg says Canada’s 6-month overnight index swap rate, a gauge of what the overnight rate will average over that period, is at a 1-year high.
Also up is the 5-year bond yield, which influences fixed mortgage rates. It made a new 5-month high yesterday.
Check out how fast the tone has changed in the analyst community:
"It increasingly seems as though the Bank of Canada is very tempted toward a June hike." – Eric Lascelles, chief rates strategist at TD Securities. (Edmonton Journal)
“I cannot imagine a lower inflation forecast being unveiled come April, but can easily see a higher and sooner forecast.” – Derek Holt, economist at Scotia Capital. Holt thinks Carney may raise rates in June—possibly even April. (BusinessWeek)
"We still look for a first move in July, but the odds of something happening earlier are increasing a bit." – Michael Gregory, senior economist at BMO Capital Markets. (Ottawa Citizen)
Just a few months ago, some economists were predicting rates wouldn’t rise until Q4 2010 or early 2011. It’s amazing what a string of hawkish economic reports will do to expectations.