{"id":41120,"date":"2020-07-13T19:47:00","date_gmt":"2020-07-14T00:47:00","guid":{"rendered":"http:\/\/prefblog.com\/?p=41120"},"modified":"2020-07-13T19:47:00","modified_gmt":"2020-07-14T00:47:00","slug":"july-13-2020","status":"publish","type":"post","link":"https:\/\/prefblog.com\/?p=41120","title":{"rendered":"July 13, 2020"},"content":{"rendered":"

The Bank of Canada is worrying about how to measure inflation<\/a>:<\/p>\n

While the official CPI data indicated potentially worrisome declines in consumer prices in the peak lockdown months \u2013 a 0.2-per-cent drop year over year in April, and an even deeper 0.4-per-cent decline in May \u2013 the newly developed \u201canalytical price index,\u201d as Statscan is calling it, showed a flat reading for April and a slim 0.1-per-cent decline for May. Still in deflationary territory, but just barely.<\/p>\n

Deflation is a potentially catastrophic threat to any economy, so the CPI trend had definitely raised some antennae. It\u2019s an especially big deal for the Bank of Canada, which relies on an inflation target of 2 per cent as its guide to applying monetary policy to help steer the economy to health.
…<\/b>
But during the lockdowns, some items in the usual basket have been unavailable or at least very difficult to buy (e.g. theatre tickets, flights abroad, sit-down restaurant meals, haircuts), while other items became a higher priority on households\u2019 shopping lists (e.g. store-bought food, baking supplies, hand sanitizer). The normal CPI basket didn\u2019t seem to apply; Statscan has been measuring the prices for goods that no one is buying, while under-weighting things that have dominated consumer spending.<\/p>\n

The analytical price index \u2013 which essentially reweights the CPI to reflect the sudden and sweeping changes in spending patterns \u2013 does, indeed, reveal these distortions. While Statscan cautioned that the findings are \u201cexperimental,\u201d and shouldn\u2019t be considered a replacement for the official inflation statistics, they do support the views expressed by Bank of Canada Governor Tiff Macklem in a speech and press conference three weeks ago: that prices probably haven\u2019t slid as deeply as the CPI suggests, but the reality is only modestly better.<\/p><\/blockquote>\n

The comments a few weeks ago<\/a> were full of yield curve control<\/a> … and the BoC is buying long bonds<\/a>:<\/p>\n

The BoC on Monday purchased $600-million of 30-year bonds in a reverse auction. The maximum amount had previously been $400-million, according to strategists.
…<\/b>
The 30-year yield jumped by more than 10 basis points – its largest increase since mid-March – last week when the government released its new deficit forecast.<\/p>\n

The BoC appears \u201cto be changing the composition\u201d of its balance sheet to more closely match Ottawa\u2019s preference for longer-term borrowing, said Andrew Kelvin, chief Canada strategist at TD Securities.<\/p>\n

Investors will on Wednesday eye the BoC\u2019s interest rate announcement, as well as the central bank\u2019s Monetary Policy Report, the first since Tiff Macklem took the reins as governor, for changes to the bond-buying program.<\/p><\/blockquote>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
HIMIPref™ Preferred Indices
These values reflect the December 2008 revision of the HIMIPref™ Indices<\/strong>
Values are provisional and are finalized monthly<\/td>\n<\/tr>\n
Index<\/td>\nMean
Current
Yield
(at bid)<\/td>\n		Median
YTW<\/td>\n		Median
Average
Trading
Value<\/td>\n		Median
Mod Dur
(YTW)<\/td>\n		Issues<\/td>\nDay’s Perf.<\/td>\nIndex Value<\/td>\n<\/tr>\n
Ratchet<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n0.3142 %<\/td>\n1,451.1<\/td>\n<\/tr>\n
FixedFloater<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n0.3142 %<\/td>\n2,662.6<\/td>\n<\/tr>\n
Floater<\/td>\n5.76 %<\/td>\n5.81 %<\/td>\n77,717<\/td>\n14.20<\/td>\n3<\/td>\n0.3142 %<\/td>\n1,534.5<\/td>\n<\/tr>\n
OpRet<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n-0.0171 %<\/td>\n3,464.2<\/td>\n<\/tr>\n
SplitShare<\/td>\n4.85 %<\/td>\n4.82 %<\/td>\n58,637<\/td>\n3.78<\/td>\n7<\/td>\n-0.0171 %<\/td>\n4,137.0<\/td>\n<\/tr>\n
Interest-Bearing<\/td>\n0.00 %<\/td>\n0.00 %<\/td>\n0<\/td>\n0.00<\/td>\n0<\/td>\n-0.0171 %<\/td>\n3,227.9<\/td>\n<\/tr>\n
Perpetual-Premium<\/td>\n5.16 %<\/td>\n5.01 %<\/td>\n66,544<\/td>\n4.06<\/td>\n1<\/td>\n0.7123 %<\/td>\n3,055.0<\/td>\n<\/tr>\n
Perpetual-Discount<\/td>\n5.61 %<\/td>\n5.76 %<\/td>\n78,140<\/td>\n14.29<\/td>\n35<\/td>\n0.2168 %<\/td>\n3,252.9<\/td>\n<\/tr>\n
FixedReset Disc<\/td>\n6.17 %<\/td>\n5.05 %<\/td>\n138,394<\/td>\n15.01<\/td>\n75<\/td>\n0.1833 %<\/td>\n1,833.3<\/td>\n<\/tr>\n
Deemed-Retractible<\/td>\n5.33 %<\/td>\n5.55 %<\/td>\n79,849<\/td>\n14.35<\/td>\n27<\/td>\n0.1259 %<\/td>\n3,210.4<\/td>\n<\/tr>\n
FloatingReset<\/td>\n2.45 %<\/td>\n3.84 %<\/td>\n31,355<\/td>\n1.53<\/td>\n4<\/td>\n-0.1047 %<\/td>\n1,714.3<\/td>\n<\/tr>\n
FixedReset Prem<\/td>\n5.51 %<\/td>\n5.10 %<\/td>\n337,040<\/td>\n15.31<\/td>\n3<\/td>\n0.0535 %<\/td>\n2,556.5<\/td>\n<\/tr>\n
FixedReset Bank Non<\/td>\n1.97 %<\/td>\n2.84 %<\/td>\n127,211<\/td>\n1.52<\/td>\n2<\/td>\n0.1431 %<\/td>\n2,800.4<\/td>\n<\/tr>\n
FixedReset Ins Non<\/td>\n6.46 %<\/td>\n5.17 %<\/td>\n97,478<\/td>\n14.77<\/td>\n22<\/td>\n-0.0832 %<\/td>\n1,843.8<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n\n
Performance Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nChange<\/td>\nNotes<\/td>\n<\/tr>\n
TD.PF.C<\/td>\nFixedReset Disc<\/td>\n-1.76 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 15.04
\nEvaluated at bid price : 15.04
\nBid-YTW : 4.86 %<\/td>\n<\/tr>\n
IFC.PR.G<\/td>\nFixedReset Ins Non<\/td>\n-1.59 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 15.50
\nEvaluated at bid price : 15.50
\nBid-YTW : 5.27 %<\/td>\n<\/tr>\n
SLF.PR.I<\/td>\nFixedReset Ins Non<\/td>\n-1.14 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 15.55
\nEvaluated at bid price : 15.55
\nBid-YTW : 5.10 %<\/td>\n<\/tr>\n
BAM.PR.X<\/td>\nFixedReset Disc<\/td>\n-1.14 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 9.53
\nEvaluated at bid price : 9.53
\nBid-YTW : 5.87 %<\/td>\n<\/tr>\n
IAF.PR.I<\/td>\nFixedReset Ins Non<\/td>\n-1.04 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 17.12
\nEvaluated at bid price : 17.12
\nBid-YTW : 4.98 %<\/td>\n<\/tr>\n
BAM.PF.H<\/td>\nFixedReset Disc<\/td>\n-1.03 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 23.21
\nEvaluated at bid price : 24.00
\nBid-YTW : 5.21 %<\/td>\n<\/tr>\n
BIP.PR.C<\/td>\nFixedReset Disc<\/td>\n1.00 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 22.65
\nEvaluated at bid price : 23.13
\nBid-YTW : 5.81 %<\/td>\n<\/tr>\n
BAM.PR.K<\/td>\nFloater<\/td>\n1.09 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 7.45
\nEvaluated at bid price : 7.45
\nBid-YTW : 5.81 %<\/td>\n<\/tr>\n
GWO.PR.N<\/td>\nFixedReset Ins Non<\/td>\n1.12 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 9.00
\nEvaluated at bid price : 9.00
\nBid-YTW : 4.67 %<\/td>\n<\/tr>\n
BAM.PR.Z<\/td>\nFixedReset Disc<\/td>\n1.20 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 15.18
\nEvaluated at bid price : 15.18
\nBid-YTW : 5.88 %<\/td>\n<\/tr>\n
CU.PR.H<\/td>\nPerpetual-Discount<\/td>\n1.54 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 24.08
\nEvaluated at bid price : 24.37
\nBid-YTW : 5.45 %<\/td>\n<\/tr>\n
MFC.PR.F<\/td>\nFixedReset Ins Non<\/td>\n1.58 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 9.00
\nEvaluated at bid price : 9.00
\nBid-YTW : 5.00 %<\/td>\n<\/tr>\n
TRP.PR.C<\/td>\nFixedReset Disc<\/td>\n1.67 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 8.50
\nEvaluated at bid price : 8.50
\nBid-YTW : 5.60 %<\/td>\n<\/tr>\n
SLF.PR.J<\/td>\nFloatingReset<\/td>\n1.75 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 8.70
\nEvaluated at bid price : 8.70
\nBid-YTW : 4.60 %<\/td>\n<\/tr>\n
BIK.PR.A<\/td>\nFixedReset Disc<\/td>\n1.89 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 22.97
\nEvaluated at bid price : 24.20
\nBid-YTW : 6.04 %<\/td>\n<\/tr>\n
SLF.PR.G<\/td>\nFixedReset Ins Non<\/td>\n2.68 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 9.19
\nEvaluated at bid price : 9.19
\nBid-YTW : 4.87 %<\/td>\n<\/tr>\n
PWF.PR.P<\/td>\nFixedReset Disc<\/td>\n2.99 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 8.60
\nEvaluated at bid price : 8.60
\nBid-YTW : 5.71 %<\/td>\n<\/tr>\n
CCS.PR.C<\/td>\nDeemed-Retractible<\/td>\n6.84 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 22.39
\nEvaluated at bid price : 22.65
\nBid-YTW : 5.55 %<\/td>\n<\/tr>\n
TD.PF.E<\/td>\nFixedReset Disc<\/td>\n12.59 %<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 16.10
\nEvaluated at bid price : 16.10
\nBid-YTW : 5.02 %<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n\n
Volume Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nShares
Traded<\/td>\n		Notes<\/td>\n<\/tr>\n
BAM.PR.B<\/td>\nFloater<\/td>\n100,800<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 7.45
\nEvaluated at bid price : 7.45
\nBid-YTW : 5.81 %<\/td>\n<\/tr>\n
PVS.PR.H<\/td>\nSplitShare<\/td>\n39,550<\/td>\nYTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2027-02-28
\nMaturity Price : 25.00
\nEvaluated at bid price : 24.45
\nBid-YTW : 5.21 %<\/td>\n<\/tr>\n
POW.PR.G<\/td>\nPerpetual-Discount<\/td>\n34,070<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 23.57
\nEvaluated at bid price : 23.85
\nBid-YTW : 5.90 %<\/td>\n<\/tr>\n
RY.PR.R<\/td>\nFixedReset Prem<\/td>\n30,923<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 23.92
\nEvaluated at bid price : 25.11
\nBid-YTW : 5.16 %<\/td>\n<\/tr>\n
GWO.PR.F<\/td>\nDeemed-Retractible<\/td>\n26,554<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 24.68
\nEvaluated at bid price : 25.00
\nBid-YTW : 5.94 %<\/td>\n<\/tr>\n
TD.PF.K<\/td>\nFixedReset Disc<\/td>\n26,000<\/td>\nYTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 16.91
\nEvaluated at bid price : 16.91
\nBid-YTW : 4.84 %<\/td>\n<\/tr>\n
There were 18 other index-included issues trading in excess of 10,000 shares.<\/td>\n<\/tr>\n<\/table>\n\n\n\n\n\n\n\n\n\n
Wide Spread Highlights<\/strong><\/td>\n<\/tr>\n
Issue<\/td>\nIndex<\/td>\nQuote Data and Yield Notes<\/td>\n<\/tr>\n
BIP.PR.E<\/td>\nFixedReset Disc<\/td>\nQuote: 20.12 – 20.80
\nSpot Rate : 0.6800
\nAverage : 0.4866<\/p>\n

YTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 20.12
\nEvaluated at bid price : 20.12
\nBid-YTW : 6.28 %<\/td>\n<\/tr>\n

TRP.PR.D<\/td>\nFixedReset Disc<\/td>\nQuote: 12.72 – 13.20
\nSpot Rate : 0.4800
\nAverage : 0.3072<\/p>\n

YTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 12.72
\nEvaluated at bid price : 12.72
\nBid-YTW : 5.91 %<\/td>\n<\/tr>\n

CU.PR.C<\/td>\nFixedReset Disc<\/td>\nQuote: 14.18 – 14.73
\nSpot Rate : 0.5500
\nAverage : 0.3797<\/p>\n

YTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 14.18
\nEvaluated at bid price : 14.18
\nBid-YTW : 5.04 %<\/td>\n<\/tr>\n

TRP.PR.B<\/td>\nFixedReset Disc<\/td>\nQuote: 7.60 – 7.98
\nSpot Rate : 0.3800
\nAverage : 0.2130<\/p>\n

YTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 7.60
\nEvaluated at bid price : 7.60
\nBid-YTW : 5.47 %<\/td>\n<\/tr>\n

BAM.PF.H<\/td>\nFixedReset Disc<\/td>\nQuote: 24.00 – 24.55
\nSpot Rate : 0.5500
\nAverage : 0.3832<\/p>\n

YTW SCENARIO
\nMaturity Type : Limit Maturity
\nMaturity Date\t: 2050-07-13
\nMaturity Price : 23.21
\nEvaluated at bid price : 24.00
\nBid-YTW : 5.21 %<\/td>\n<\/tr>\n

PVS.PR.H<\/td>\nSplitShare<\/td>\nQuote: 24.45 – 24.88
\nSpot Rate : 0.4300
\nAverage : 0.2673<\/p>\n

YTW SCENARIO
\nMaturity Type : Hard Maturity
\nMaturity Date\t: 2027-02-28
\nMaturity Price : 25.00
\nEvaluated at bid price : 24.45
\nBid-YTW : 5.21 %<\/td>\n<\/tr>\n<\/table>\n","protected":false},"excerpt":{"rendered":"

The Bank of Canada is worrying about how to measure inflation: While the official CPI data indicated potentially worrisome declines in consumer prices in the peak lockdown months \u2013 a 0.2-per-cent drop year over year …<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[15],"tags":[],"class_list":["post-41120","post","type-post","status-publish","format-standard","hentry","category-market-action"],"_links":{"self":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/41120","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=41120"}],"version-history":[{"count":0,"href":"https:\/\/prefblog.com\/index.php?rest_route=\/wp\/v2\/posts\/41120\/revisions"}],"wp:attachment":[{"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=41120"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=41120"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/prefblog.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=41120"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}