Canadian Dollar edges lower as rising US inflation bolster Fed rate hike outlook

The Cato Institute argues that April's inflation spike leaves the Fed with no choice but to raise rates.

Polymarket indicates a 97% chance of US inflation exceeding 4% in 2026, suggesting prolonged higher interest rates or further hikes.

Treasury yields are rising as a global bond sell-off occurs, driven by investor fears over inflation.

Hot April inflation data has led to expectations that the Fed will delay rate cuts until late 2026.