– Daily Commentary BY THE CURVE TEAM –

19th of November, 2021

Yields Drift Lower as Dust Settles on Wages Data

• After an initial muted response, the yield curve has flattened a touch in the wake of the wages data on Wednesday.
• The weak headline result supports the RBA’s view that there is no rush to tighten policy.
• However, the improvement in private sector wages will have the RBA on notice
• What it means is that the tension between the RBA’s outlook and the Market’s will continue through to February, resulting in high volatility, which will present investment opportunities.

Canadian Inflation

• Another day and another solid inflation release, this time in Canada
• Core inflation is still running ahead of the Bank of Canada’s target
• Like most central banks, pressure is mounting to take action