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Breakfast Bites - Will Canada cut rates today?

Bank of Canada - cut or hold?; Japan - Data could support a hike; Jolt to JOLTS

Author

Ayesha Tariq
June 05, 2024

Rise and shine everyone.

Today, we have the Bank of Canada Interest Rate Decision today and we may very well see the first rate cut! This would make them the first DM central bank to cut rates in this cycle.

Asian markets are stabilizing today - Indian markets are recouping some their losses after election results. The likelihood of Modi coming back as PM is still very high with the NDA alliance.

US Equity Futures are trading firmer this morning after yesterday’s close in the green. Metals and energy are also trading higher, and UST yields are firmer, alongside the US dollar.

Copper, however, continues to pullback, as did utilities yesterday. The AI Power Demand theme seems to be taking a hit here. But, this theme is not likely done, and with US growth being called into question, we think the markets will continue to favor defensives. We saw that in yesterday’s rotation where consumer staples and healthcare caught a bid.

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