Canada remains mired in a combination of softening underlying growth and transitory shocks all of which is clouding our understanding of what’s truly going on in the economy. The outcome is a roughly flat economy in Q2 and so far in Q3. The Canada two-year yield fell by about 4–5bps in the aftermath primarily on the back of the GDP figures with a small assist from softer than expected core PCE inflation in the US (+0.1% m/m, consensus 0.2%). USDCAD shook off the net effects of Canadian GDP and US core PCE with only minor moves in the currency. Bank of Canada pricing moved a couple of basis points lower for the ... (full story)