Canadian inflation surprised higher than expected on the headline and underlying measures and details. The result vaulted the Canadian dollar to the top of the heap versus major crosses to the USD and CAD would have been stronger yet if not for strong US data (retail sales, industrial output) that drove broad USD strength. Canada’s rates curve is getting crushed with a double digit increase in yields across most maturities concentrated in a 14bps spiked in the two-year yield on the day. OIS markets bumped up terminal rate pricing post-data and rate cuts have been wiped off the map for the rest of the year’s meeting ... (full story)