BMO Views from the North Dire Straits
Apr 2, 2026
Adam Whitlam, head of Toronto rates sales at BMO, offers market color and provincial credit perspective. Conversation covers geopolitical shocks and London meetings. They discuss Bank of Canada prospects, provincial issuance and spreads. The talk highlights curve dynamics, flow behavior, and concrete trade ideas around provincial and long-end plays.
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Bank Of Canada Hikes Depend On Inflation Breadth
- Bank of Canada hikes are unlikely soon unless inflation breadth expands beyond energy shocks.
- Macklem signalled cuts absent the oil shock, so only sustained broad inflation over several months (3+ reports) would force hikes into July or later.
Conflict Boosts CAD As A Safe Resource Currency
- Adam and Ben are bullish on the Canadian dollar as a safe, reliable resource supplier amid the conflict.
- FX strength is currently a flight-to-quality bid but should reverse back to the prior dollar weakness regime once the conflict ends.
USMCA Deal Could Quickly Lift Canadian Growth
- USMCA negotiations are active and could be completed quickly; a deal would catalyze Canadian growth and potentially flip BoC policy.
- Ben suggests a July timeline (symbolic US dates may accelerate a US-friendly deal).