Select Language

Search

Insights

No match found

Services

No match found

Industries

No match found

People

No match found

Insights

No match found

Services

No match found

People

No match found

Industries

No match found

The Central Bank Conundrum - Views from the North

FICC Podcasts June 09, 2022
FICC Podcasts June 09, 2022

 

This week, Adam Whitlam, part of the Toronto-based fixed income sales team, joins me to discuss the outlook for the Bank of Canada after last week’s hawkish surprise, Canada-US cross-market spreads, and the risk backdrop amid huge volatility and broad uncertainty.

As always, all feedback welcome.


Follow us on Apple PodcastsGoogle Podcasts and Spotify or your preferred podcast provider.


About Views from the North

BMO’s Canadian Rates Strategist, Ben Reitzes hosts roundtable discussions offering perspectives from strategy, sales and trading on the Canadian rates market and the macroeconomy. 

Podcast Disclaimer

Read more

Ben Reitzes:

Welcome to Views From The North, a Canadian rates and macro podcast. This week I'm joined by Adam Whitlam, senior member of our BMO rate sales team. This week's episode is titled The Central Bank Conundrum.

Ben Reitzes:

I'm Ben Reitzes. Welcome to Views From The North. Each episode, I will be joined by members of BMO's FICC sales and trading desk to bring you perspectives on the Canadian rates market and the macro economy. We strive to keep this show as interactive as possible by responding directly to questions submitted by our listeners and clients.

Ben Reitzes:

We value your feedback, so please don't hesitate to reach out with any topics you'd like to hear about. I can be found on Bloomberg or via email at benjamin.reitzes@bmo.com. That's benjamin.reitzes@bmo.com. Your input is valued and greatly appreciated.

Speaker 2:

The views expressed here are those of the participants and not those of BMO Capital Markets, its affiliates, or subsidiaries.

Ben Reitzes:

All right, Adam. Welcome back to the show. Lots going on in Canada these days, so I think we can keep things pretty lively.

Adam Whitlam:

I agree there is a lot going on out there right now. It's a very interesting time to be in fixed income markets.

Ben Reitzes:

It's wild. It seems like every day is a 10 basis point move. Otherwise, it's not a normal day anymore.

Adam Whitlam:

If you don't get a 10 basis point move, it's almost like the market was closed.

Ben Reitzes:

Let's start with the Bank of Canada. It was last week, but that's still the driving force for the Canadian market. They came out. They were more hawkish than expected. They warned they could act more forcefully if necessary. That was a clear nod or hint at maybe going 75 and Deputy Governor Beaudry said that they could even go past 3%. For the record, they have said that before. That part wasn't new, but still the market has reacted accordingly.

Ben Reitzes:

We've seen Canada get absolutely annihilated pretty consistently since that day. And then, even to some extent, in the lead-up to that. Here we are, and terminal rates in Canada are the highest they've been. One-year, one-year ... Is it like 3.80% or 3.90%? That's the highest we've had since pre-global financial crisis. Let me put it that way. Just to give you an idea. It's a pretty challenging world. The market has gone to price in, for sure, 50 in July. 50% of a 75 basis point move. Is that right? Should we be pricing in 75? Should we stick with 50? Where do you think we go from here?

Adam Whitlam:

I think the market is doing Beaudry's job for him. They have priced a lot in. They priced in a really good likelihood of a 75 basis point height. We're going to get a CPI print next week. In two weeks, rather. If you've been reading anything that Ben's been talking about, we're looking for another pretty big print there, 7% to 7.5%. Gasoline has been really robust. They're going to make some changes in terms of the basket weightings, which could add a little bit of additional volatility.

Adam Whitlam:

But if we consider that, during the pandemic, they shifted from services consumption into goods consumption to account for patterns ... You've got to think, at this point, there's probably some shift back toward the services side. And if you tried to book anything in the last little while, service prices have skyrocketed along with everything else. Food has remained really robust. The only area where we've maybe seen some weakness ... Well, even cars. This is a little more backward looking.

Adam Whitlam:

Some of the car pricing has actually eased up in the last little while. But if you look back toward the CPI that we're looking at, you're still going to get really robust used car prices and new car prices. The only area where we've maybe seen some softening has been in home prices. That's been on the back of the interest rate hikes that have already come to the market from the Bank of Canada. We're still going to get a really spicy inflation number.

Adam Whitlam:

The market is opening the door for them to do 75. If I'm the Bank of Canada, I'm probably thinking, "I'm not going to look a gift horse in the mouth." Why not take it? Do my 75 basis points. I want to get to neutral as fast as possible, and I've made that really clear. Where neutral is ... Is it 2% to 3%? Is it 3%? Is it higher than 3%? Just as I walked in here, terminal was 3.80%, as we continue to underperform the US again today. I think post-CPI, we're probably going to start pricing in 75% chance of a 75 BP hike. I think they take it.

Ben Reitzes:

I'm with you there. I'm going to nerd out for a second on CPI. For listeners out there, they are going to make changes to the basket as Adam mentioned. Probably, more weight goes to services away from goods. What's interesting is last time, when they shifted more into goods, we had already seen a big increase in a lot of goods prices. And so, they missed a lot of the inflationary impulse there. Now, we're shifting back to services. I'd argue that you probably haven't seen a lot of the inflationary impulse in services yet.

Ben Reitzes:

It's still brewing, so I'm not entirely sure which way the changes in the basket weights will bias things. But I think higher on the used cars. It's worth noting that, at the end of the day, I think what will actually end up happening ... Because they just add them in and they don't adjust history. Used car prices are already really high, so if anything, they only have mostly down to go. At the end of the day, it might actually be disinflationary. Believe it or not. Because they've added them so late. After prices are up 80%, they probably only have one way to go. Even if that's not going to happen in the next few months.

Ben Reitzes:

It could add a little more upward pressure in the near term, but that's going to be downward. I'm getting like 1% to 1.5% on the month-over-month for CPI. That equals 7% to 7.5% year-over-year. We'll see. I'm going to wait for the basket changes to really solidify that. But it's clear that businesses are very stretched. Margins are already quite tight, and when cost increases come through, they raise prices immediately. My favorite salad place has raised their prices three times in less than six months. Now, lunch costs $18, which I'm not willing to spend. I need a new favorite salad place. Just an example of where we are.

Ben Reitzes:

On the Bank and them going 75? I'm with you. It feels as though the market's going to force their hand. Assuming the CPI print is hot, you're probably going to get up to 75% chance. Once you're there, how could the Bank say no to that? Unless they come out with a speech and say, "Actually, we've changed their mind," then things might change. But I would look for a speech from them anyways. Just to solidify expectations either way. Because they've done a pretty good job on communication. I think they want to continue that trend, and make sure that they're as clear as day when it comes to where policy is going and what they want to be doing.

Ben Reitzes:

The reason behind going 75, even if I personally don't think they probably should, is that they need to be seen as fighting inflation as hard as they can. They're afraid of expectations getting out of control. And so, the quicker they get to neutral or beyond that, the quicker demand slows down and inflation starts to go the other way. If I were the governor ... And I'm not. Nor will I probably ever be. But if I were, a string of 50s makes a little more sense to me.

Ben Reitzes:

It lengthens the timeline in which they're hiking. It lets you talk tough about inflation for that much longer. And it gives you a little bit more time to assess the impact of hikes. Although, really they're not going to get all that much, at the end of the day. We'll see how things play out, but July is shaping up to be quite interesting. And the CPI number on June 22nd is going to be clearly pivotal. What about that endpoint? What about that 3.80% we're priced in, in one-year, one-year? Are we just out of our minds?

Adam Whitlam:

That's an interesting question. Because in my view, that has been that the consumer balance sheet in Canada is in much worse shape than it is in the US. We're more highly levered. We have larger amounts of housing debt. We've seen that in what's been going on. Not across the country necessarily, but in the bubbly markets of the Vancouvers and the Torontos. You can even look at some of the outside the GTA cottage country and what's been going on there. Some of the rec property stuff as interest rates have only just started to go up.

Adam Whitlam:

Now, we start talking about some good likelihood. Both of us are on the same page about a supersized 75 basis point hike coming in July. Probably, another 50 basis point hike coming after that. I do think, to some extent, if you start doing the supersized hike of 75 and then the 50 ... You're really just pulling forward rate hikes that you would be otherwise stretching out.

Adam Whitlam:

Does a big rate hike coming up in July mean that terminal should be going higher? Not necessarily ... You're looking at inflation, as Joel Prussky's mentioned, "It's like looking in a rear view mirror." We should see inflation start to abate. We know it's not the next print. The print after that? Perhaps. But past that, we should see inflation start to come off.

Adam Whitlam:

On top of that, you could see a pretty abrupt correction in some of these housing markets, which would give the Bank a reason to pause sooner. If they were to put some of these big rate hikes, front-load them, get inflation under control, and then take a pause to really evaluate what's happened. 3.80% to me seems pretty high at this point.

Ben Reitzes:

All right. I agree with you, but I'm going to play devil's advocate here. Gas prices rose 12% in May. They're up 5% month to date in June. It is June 8th at 1:30 in the afternoon. They could be up 8% by now, for all I know. Oil is trading at $120 bucks today. Who knows? No guarantee oil doesn't keep going. In fact, I would be biased to say that the risk for oil is still on the upside, which means gasoline prices still have more upside. What happens when inflation doesn't slow down in the second half of the year?

Ben Reitzes:

What happens when it stays at ... Why don't we just call it north of 6%? Even if we go from 7% down to 6.2%, and we just go back and forth in the sixes. Can the Bank be like, "You know what? I think I'm done here. I've done my job. Rates are at 2.5%, 3%, 6%. Inflation will come down over time. I'm finished." Do they not need to worry about inflation expectations?

Ben Reitzes:

Is that not a big issue for them? If they allow that level of inflation to continue without acting against it? Isn't that what they're trying to do? Isn't that why they're talking so hawkishly in the first place? As much as I agree, I think housing gets ... The higher rates go, the worse this is going to get for housing. That's pretty clear, but maybe they have no choice.

Adam Whitlam:

Oil is the caveat for sure. The part of this equation where I agree with you, in terms of oil prices, I don't think oil prices are coming off. There is a structural situation going on in oil. In terms of supply, without access to Russian reserves as that war continues, and the inability or the difficulty in the US for their basin to turn on their production. It's just going to remain constrained.

Adam Whitlam:

Add on top of that, let's talk about hurricane season. Hurricane season. We're getting into it. We've had a tropical storm already hit Miami. Ocean temperatures. This is way off the beaten path, but if you actually look at ocean temperatures, they're quite high at this point. The NOAA is forecasting a pretty aggressive hurricane season this year, which is just going to, forgive the pun, but add fuel to the fire for oil prices.

Adam Whitlam:

I agree. I see those continuing to go up and up and up. And then, you get into a strange situation where gasoline prices are going higher. You're taking a bigger bite out of the consumer. We also have average hourly earnings in Canada, which are weaker than the US. The US average hourly earnings are actually down turning now. At some point, these high energy prices are going to take a bite. These higher interest prices are going to take a bite.

Adam Whitlam:

You're going to get a pretty big slowdown. And then, you get into the whole stagflation argument. What could happen there? It's a really delicate balance if you're a central bank right now. Especially, one that's as leveraged to energy as we are.

Ben Reitzes:

I'm not envious of central bankers at the moment.

Adam Whitlam:

No way.

Ben Reitzes:

I think they're almost in an impossible spot.

Adam Whitlam:

Well, what do you do then? What do you do if you're at 6% inflation but growth is at zero?

Ben Reitzes:

That's it. At what point do you stop fighting against inflation expectations, and realize that the economy's going to soften in a hurry and that will take care of things for you? But it's almost like until the economy softens, you have to keep being tough, which is why you don't want to go 75. Because this seems like you're going to get ... We're eventually going to get to that point where something bad happens it seems. And so, why do you want to be overly aggressive at the front?

Ben Reitzes:

At least, look like you're aggressive. 50s are plenty aggressive. Given history. I'm still not a huge fan of that 75, even if I think it's probably pretty good odds at this point. I don't envy Mr. Macklem or Mr. Powell. Because they're going to have a tough choice to make. Damned if you do and you're damned if you don't, potentially. And so, it's like, "Short-term pain? Or long-term pain?" If they stop raising rates too early, inflation expectations start to move notably higher and really take root at a higher level ... They're going to have to crush the economy even more down the road.

Ben Reitzes:

Or you raise rates more aggressively now, you have a bigger slowdown in the very near term, but inflation expectations don't move higher. I don't think you win either way. Which one do you lose least in? I don't have the answer to that. I wish I did, but I can't help but to be bearish. Sorry, folks out there, but there's really no other outcome I see. I guess I can hope that oil prices might go down. That would be the one. That's the one outcome that I think saves all this stuff, but I just don't see that happening.

Ben Reitzes:

Hurricane season, as Adam mentioned, will be ... If you get another meaningful sized hurricane in the Gulf of Mexico and you take the refineries in Texas offline, or production in the Gulf of Mexico offline, you're going to see significantly higher gasoline and oil prices in the summer months, when driving season is at its peak. Maybe a challenging summer ahead for all of us.

Adam Whitlam:

You mentioned the Fed. Speaking of which, this is obviously very topical, because it's coming up. What do you think? We've obviously seen more hawkishness from the RBA. More hawkishness from the Bank of Canada. Even the perma-dove of the ECB is starting to turn the ship around finally. They were the last central bank to maybe get on board with rate hikes. What do you think for the Fed?

Ben Reitzes:

Well, they've already come out. The dove and the Fed. Brainard came out and said, "We're not pausing in September. That's not something to be thinking about right now." The risks have to be skewed toward them being more hawkish. Doesn't it?

Adam Whitlam:

I'd have to think so.

Ben Reitzes:

I don't see it the other way. That's for sure. Given that we are firmly priced for 50s in the US, but nothing really more than that. And so, that brings to the fore Canada and US trades. We'll get US CPI on Friday, so that can move things around a bit as well. But Canada has vastly underperformed the US over the past week. Driven by the Bank of Canada. I don't personally see a world in which the Bank vastly outpaces the Fed. That's just not a realistic place.

Ben Reitzes:

If you look at long term ... Any trend, be it inflation or growth, the US is firmer in both than Canada. And so, that should mean higher rates in the US at the end of the day. And so, Canada looks extremely cheaper. I still wouldn't be buying it until you get that peak Bank of Canada pricing. But there's a decent chance that Friday's CPI number causes meaningful weakness in the US, and the Fed comes out and sounds more hawkish next week. Maybe odds of 75 start to get priced in the US as well? I'm not the US expert at BMO, but you've got to think that's where the risks lie.

Adam Whitlam:

Trades have been being put on in Canada. A lot of them have been put on early. It's a typical Canada setup. Canada looks cheap, "Guys, come in to buy Canada versus the US." And it just goes right in their face. An additional 25 or 50 BPS. One trade that we've been looking at and the guys have been talking about is five-year, five-year, Canada-US. That trade, which looked like a great receive for Canada in and around 60 basis points, is at 75 basis points now.

Adam Whitlam:

Now, we're talking about levels that we see during crises. We see it in 2008. We saw it in 2010. We saw it in 2011. And so, we're at multi-decade type levels, where Canada does look cheap versus the US. I don't know. Is it worth taking upon here? Yeah. I do think Canada looks cheap versus the US. I think that Canada curve 5s10s being positively sloped versus ... As of this morning, the US curve was inverted. US tenure auction wasn't that good, so it's probably back to positive now. But still, the Canada 5s10s curve being positively sloped while 10s30s is inverted looks pretty cheap. I probably wouldn't mind taking a stab at that trade around these levels.

Ben Reitzes:

10s definitely cheap on the curve. I've been recommending 5s10s, 30s, Canada-US for a while. That's gone pretty well. Canada 5s10s against the US as well has done pretty decently. Geez. It's almost like until Bank of Canada pricing peaks, it's hard to have high conviction there. That being said, I would still dip a toe in five-year, five-year receive Canada-US, because the levels are just outrageous today. We'll see if we're still here tomorrow, but they're out of this world. And then, just starting small and dipping a toe in does make pretty good sense here.

Ben Reitzes:

Related topic. Credit spreads. Let's talk specifically about CMBs and provincial spreads. Risk markets generally have held up better than I personally thought they would. I think there's still downside there. The macro view we outlined a few minutes ago should make that pretty clear, but they've held up pretty well. We've seen ongoing pretty good demand for provies. 10-year sector has done really well. We've seen the 10s30s box steepen on the back of that. What outlook do you have for provies year supply? It has come down notably with some better budget outcomes. Are we going to continue to see strong risk markets, tighter provie spreads? Or are we at the tights maybe?

Adam Whitlam:

I don't think we're at the tights, but I also don't think we're at the wides. Given, like you said, our global macro backdrop. I think we're going to see the Fed continue to speak hawkishly and continue to raise rates. And I think that's going to have the same impact that it has been having on equity markets. As discount future cash flows, it's going to still hammer down the NASDAQ. That's still just going to put general pressure on spreads. I think Canada got beat up quite a lot relative to the US in terms of credit spreads, so we've seen some rotation.

Adam Whitlam:

That's been mainly more so on the corporate side, but we've seen some rotation out of US corporate credit and into Canada credit. We saw that in the last couple of weeks, as banks were coming out of earnings blackout and starting to issue five-year notes that looked pretty attractive. On a relative basis, things like provies and CMBs compared to say corporate credit have actually held in fairly well. Those spread differentials are pretty wide. I think there's a couple reasons for that.

Adam Whitlam:

One is swap spreads have come way off. Part of that is what's gone on, on the rates curve, and the underperformance of Canada. And so, that's put some downward pressure on swap spreads. That's brought in all kinds of ... Your asset swap community has been in actively. They generally don't tend to look at bank. Definitely not bank deals. They generally don't tend to look at corporates as often. That's really favorable for a provie spread, CMB spread. I think that's why some of that basis has been getting wide.

Adam Whitlam:

And then, again, they also focus on the short end of the curve. Out to the ten-year. Five-year, seven-year, ten-year. I think that's another reason you've seen things like the 10s30s Ontario box start to steepen out. I think we could take another look at some of the wides that we've had in Ontario in longs. Why we got as wide as an intro day level of 100 and a half. I wouldn't be surprised if we got back to 100 and a half. Just especially as say the Fed hikes rates surely. And so, that wouldn't shock me.

Adam Whitlam:

That 10s30s box at 25 historically is a pretty good level. But for the reasons I just mentioned, I don't necessarily think we're ... There are reasons that we could continue to steepen from here. In that 10-year part of the curve, if we look at relative value, for instance. CMB Ontario spreads. That's gotten actually fairly wide in 10s. Especially, as you compare it to where 5s are.

Adam Whitlam:

I think there's some value there in rolling out of CMBS and rolling into Ontario's. And I think the roll down in that part of the curve, the credit spread roll down, it's pretty attractive. Attractive enough to warrant putting that trade on. Whereas, in longs, there isn't nearly as much compression to take that long risk. The same is true actually in 5s. There is a lot of positive carry in 5s. There's a lot of asset swap roll down.

Adam Whitlam:

That is one of the most favorable asset swap roll down parts of the entire credit curve. If swap spreads don't skyrocket higher and they stay where they are right now, I think you're going to have asset swappers continue to put that on. That will help anchor 5s, which will help anchor 10s. Steeper credit curves is more of what we're looking at.

Ben Reitzes:

All right. What is the most prevalent client theme that you currently see?

Adam Whitlam:

Well, I've had about 15 conversations today about, "Why is Canada so cheap versus the US?" There's a lot of, "Where do I hide out in the curve," conversations that have been going on in the last little while. The inversion in 10s30s. I think a lot of the clients expected 30s were going to do well. The setup from your traditional fast money community wasn't as good. But at this point, as we've continued to have a bear flattening bias, there is a lot of, "Where do I go from here?" Longs continue to look expensive, 5s look cheap, but every day they get a little bit cheaper.

Adam Whitlam:

And so, at what point do we say, "Okay, I'm comfortable to own that." That's been probably the most prevalent conversation. Or, "At what point do we start buying Canada versus the US?" We're never going to catch the best level on that trade, but we're getting to points. Even from a flow perspective. Overseas accounts, generally speaking, the flow of funds data says that they have been selling Treasuries as the Yen has come off. Heavy selling of Treasuries, but Canada-US continues to widen.

Adam Whitlam:

Meanwhile, in Canada, flow wise, we've seen buying. At some point, these things are going to have to converge. That's been a lot of the questions and discussions that we've been having with clients is, "At what point on the curve is the best place to take advantage of that?" And it's somewhere in that belly area. Like we said, 10s are cheap. I don't mind 5s, but I think you've got to get through some of the CPI stuff. Because I think that sector could continue to suffer, where I think 10s will outperform. I've still got a flattening bias, but that's been the biggest question. Where from here?

Ben Reitzes:

That's a good question. I don't quite have the answer, but I generally agree. It's a five to 10-year area. 5s still have some room to get punished a bit here. With the Bank not quite fully priced, but man, are we close. Max bearishness on the Canadian fixed income side has to be close here. Can't imagine it's too far away, given how stretched we are. But still, it's really hard to have high conviction on a duration call at these levels.

Ben Reitzes:

You think you want to be long, because we really haven't been here in a long time. Anytime we get above 3%, we tend not to stay here for very long. But inflation is out of control and I don't know when that ends. I don't think anybody does. We've really never been here before. This is a very unique environment, a very unique time. And so, it is going to be challenging. That's why we have these conversations, because you educate me, I educate you. Hopefully, our listeners get something out of this as well.

Adam Whitlam:

Maybe a good nap, but we'll see.

Ben Reitzes:

We'll see. I would say, top trade ideas, but I'm going to guess it's Canada and the US, and 10s on the curve in Canada.

Adam Whitlam:

I'm a big fan of both those trades. I'm a fan of being long. I'm a fan of actually meeting gap flatteners. It's something I know Joel has talked about. I don't mind receiving these versus say July. That type of trade to me makes sense. Especially, if I look at three-month forward S-curves, we actually peak around March of 2023. And then, we dip again. And then, we peak again in March of '24. Which is a bit of an odd shape for a three-month forward curve.

Adam Whitlam:

But I think you look at some ... Those short-term flatteners make sense. Curve flatteners, in general? 5s10s flatteners make sense versus the US. The five-year, five-year. That's another trade I really like. I like owning provincials versus CMBS in 10s. And I like going the other way in 5s. I like going CMBS versus provincials in 5s, because that box looks pretty attractive. There's a way you cannot increase your exposure to the province relative to CMBS. By putting on that 5s10s box. All that stuff to me seems like a good buy.

Adam Whitlam:

Inflation. There's another one. Inflation breakevens. They've come back. Canadian inflation breakevens got absolutely hammered. They came back. They got hammered again. But I still think there's room to go on those. I know there's always a bit of a liquidity question. Comparatively, if 30-year breakevens are sitting around 1.80% or 1.83% ... With what we're talking about right now and persistent oil strength, that's probably still a buy. I think that product still offers some good value. We'll see what happens.

Ben Reitzes:

Lots there. Are you a seller of your house? That's probably the most important option.

Adam Whitlam:

I don't know. I've got to live somewhere.

Ben Reitzes:

That's true.

Adam Whitlam:

Unfortunately, we all have these anecdotal stories. But I've already gotten a few coming in, from some people I know, that have been waving the, "Why didn't I put this up for sale two months ago," flag. We'll see.

Ben Reitzes:

It's only down from here in near term. Unfortunately, I think it's going to be a lot more challenging on the housing front. But I guess we'll see. Thanks for coming on this week. Very much appreciate it. Hope to have you on again soon.

Adam Whitlam:

Thank you very much for having me. I can't wait to see where we're going next in 10s a month.

Ben Reitzes:

Thanks for listening to Views From The North. A Canadian rates and macro podcast. I hope you'll join me again for another episode.

Speaker 2:

This podcast has been prepared with the assistance of employees of Bank of Montreal, BMO Nesbitt Burns Incorporated, and BMO Capital Markets Corporation, together BMO, who are involved in fixed income and foreign exchange sales and marketing efforts. Accordingly, it should be considered to be a product of the fixed income and foreign exchange businesses generally, and not a research report that reflects the views of disinterested research analysts.

Speaker 2:

Notwithstanding the foregoing, this podcast should not be construed as an offer or the solicitation of an offer to sell or to buy or subscribe for any particular product or services, including, without limitation, any commodities, securities, or other financial instruments. We are not soliciting any specific action based on this podcast. It is for the general information of our clients. It does not constitute a recommendation or a suggestion that any investment or strategy referenced herein may be suitable for you. It does not take into account the particular investment objectives, financial conditions, or needs of individual clients.

Speaker 2:

Nothing in this podcast constitutes investment, legal, accounting, or tax advice. Or a representation that any investment or strategy is suitable or appropriate to your unique circumstances. Or otherwise constitutes an opinion or a recommendation to you. BMO is not providing advice regarding the value or advisability of trading in commodity interests, including futures contracts and commodity options, or any other activity, which would cause BMO or any of its affiliates to be considered a commodity trading advisor under the US Commodity Exchange Act. BMO is not undertaking to act as a swap advisor to you or in your best interests in you, to the extent applicable, will rely solely on advice from your qualified, independent representative in making hedging or trading decisions.

Speaker 2:

This podcast is not to be relied upon in substitution for the exercise of independent judgment. You should conduct your own independent analysis of the matters referred to herein, together with your qualified independent representative, if applicable. BMO assumes no responsibility for verification of the information in this podcast. No representation or warranty is made as to the accuracy or completeness of such information. BMO accepts no liability whatsoever for any loss arising from any use of or reliance on this podcast. BMO assumes no obligation to correct or update this podcast.

Speaker 2:

This podcast does not contain all information that may be required to evaluate any transaction or matter. Information may be available to BMO and or its affiliates that is not reflected herein. BMO and its affiliates may have positions, long or shorts, and effect transactions or make markets, in securities mentioned herein, or provide advice or loans to or participate in the underwriting or restructuring of the obligations of issuers and companies mentioned herein. Moreover, BMO's trading desks may have acted on the basis of the information in this podcast. For further information, please go to bmocm.com/macrohorizons/legal.

 

Benjamin Reitzes Managing Director, Canadian Rates & Macro Strategist

You might also be interested in