Curve Your Enthusiasm

Royce and Ian discuss the latest Fed announcement and how some of the accompanying projections seemed inconsistent with others. They talk about why the new forecasts could be subject to more change than usual, and how that fits in with the Fed’s new reaction function. They conclude that this leaves more room for markets to ‘fight the Fed’ dot-plot than in the previous cycle. The conversation then moves on to an analysis of the relative timing and magnitude of Bank of Canada and Fed rate hikes priced into markets. Royce asks Ian whether he expects any hints about BoC tapering from Deputy Governor Gravelle in next week’s speech. Ian closes the show with a final question about Canada’s housing market, seemingly unrelated to the rest of the episode.

Ian and Royce discuss the recent bond market selloff from their own perspectives, and conclude that a ‘high pressure’ economic outcome isn’t the driving force. Royce surprises us with his love of farms, while Ian talks about his expectations for the BoC meeting next week and when we can expect a taper.

Ian and Royce discuss the recent bond market selloff and the ongoing debate regarding the US fiscal package. With volatility increasing in both fixed income and equity markets, the arguments have moved from the ivory towers to the real world. They also touch on the implications of all this for the expected QE taper by the Bank of Canada.

Royce and Ian discuss the latest developments in the US regarding the Federal Reserve. Royce talks about how a range of employment indicators will be in focus as central bankers figure out what constitutes maximum employment, and how that will affect the timing of rate increases. Ian discusses how tapering US QE could affect Canadian rates. Ian and Royce then chat about how all of this affects the Canadian dollar.

Royce and Ian interpret the Governor of the Bank of Canada’s remarks on a host of vital issues, including a micro-cut, the effective lower bound for rates, the future of quantitative easing and the central bank’s inflation mandate. Royce also discusses the upgrades to the economic outlook in the latest Monetary Policy Report, and Ian breaks down some of the divergences seen in short-term Canadian rates.

Ian and Royce are back in the studio, talking about the potential merits of a Bank of Canada microcut. Ian discusses the interesting way in which yields have been rising, while Royce does a deep-dive on the forecasts we can expect to see coming out of the MPR next week.

Ian and Royce discuss new information regarding the Bank of Canada’s toolbox. They analyze the most likely ways the central bank can adjust its policies in the event that upside or downside risks materialize in light of the latest commentary coming from officials. The hosts also look at ways monetary policymakers can alter the mix of stimulus as they inevitably bump up against the limits of bond buying even in base-case scenarios for 2021. Ian and Royce end the show by bidding farewell to 2020 in a unique way.

Lisa Raitt joins Royce to give a former-insider’s view on what turned out to be a heftier-than-expected Fall Economic Statement from the Federal government. Ian and Royce then discuss the debt management strategy included in the document and its interplay with the Bank of Canada’s quantitative easing program. Ian sneaks in some questions at the end of the show about how worrisome the current strength in the Canadian dollar will be for the eventual economic recovery.

Ian & Royce discuss the implication of recent vaccine developments on the bond market and what it means for our macro forecast. As well, Royce discusses what the appointment of Yellen to Treasury Secretary means for the FOMC. Ian speaks about the reflation theme and what the bond market expects from the upcoming Budget update on November 30th

Royce and Ian have a wide-ranging discussion on the upcoming Bank of Canada decision. Royce outlines the updates the Bank of Canada will need to make to its forecasts, while Ian discusses the likelihood of calibrating the quantitative easing program. The conversation also touches on the limitations of the Bank of Canada’s purchases on the level of domestic bond yields, and how fiscal support might be leaking out of the Canadian economy.