Bank of Canada's Beaudry: Strong household spending and high inflation led to rate hike

Shortly, Bank of Canada Bank of Canada The Bank of Canada (BOC) is the central bank of Canada. It was created in 1934 and is responsible for implementing monetary policy in the country, issuing currency, and promoting a safe and stable financial system.The Bank's main role is to "promote the economic and financial welfare of Canada," as defined in the Bank of Canada Act. This includes maintaining the stability of the financial system, promoting a sound and efficient financial system, and fostering monetary conditions that will preser The Bank of Canada (BOC) is the central bank of Canada. It was created in 1934 and is responsible for implementing monetary policy in the country, issuing currency, and promoting a safe and stable financial system.The Bank's main role is to "promote the economic and financial welfare of Canada," as defined in the Bank of Canada Act. This includes maintaining the stability of the financial system, promoting a sound and efficient financial system, and fostering monetary conditions that will preser Read this Term deputy Paul Beaudry speaks today British Columbia with the latest Economic Progress Report. These speeches are scheduled on the day after BOC decisions where there aren't press conferences and give policymakers an opportunity to correct or guide market reactions following statements but Beaudry didn't offer any clear guidance today, nor did yesterday's statement. The market is pricing in a 64% chance of a further hike in July.

• There appears to be more momentum in demand than we expected
• BOC was surprised by Q1 consumption growth, especially strong goods spending
• Strong household spending and concerning April inflation Inflation Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Inflation is defined as a quantitative measure of the rate in which the average price level of goods and services in an economy or country increases over a period of time. It is the rise in the general level of prices where a given currency effectively buys less than it did in prior periods.In terms of assessing the strength or currencies, and by extension foreign exchange, inflation or measures of it are extremely influential. Inflation stems from the overall creation of money. This money is m Read this Term led to rate hike decision
• Details behind April headline inflation were concerning
• Three-month measures of core inflation seem to have lost momentum
• Still expects headline inflation to be near 3% in summer but that is largely due to base year and energy effects
• We agreed that total inflation could get stuck well above 2%
• It is more likely that long-term rates will remain elevated than the opposite
• There is a meaningful risk that neutral level of rates could go up

He is certainly not pushing back on the idea of further rate hikes but there has been no reaction from USD/CAD.

I think that's ultimately going to prove to be a mistake as lagged effects of hiking start to hit hard.