A new report from CIBC’s fixed-income team says that if the Bank of Canada decides to deliver a double-dose of monetary tightening with a 50 basis point rate hike, it would be best served by waiting for the central bank’s June meeting.

In a note to clients, CIBC Managing Director and Head of Fixed Income, Currency & Commodity Strategy Ian Pollick said while there is no fundamental reason Canada’s central bank couldn’t raise rates by a full half per cent at the April meeting, there are still some clogs in the financial system plumbing that would make raising rates by that amount at that meeting less than ideal.

“There is no real macro reason to not hike by 50.0 bps at the April meeting. Rather, we believe the fact that funding markets are still somewhat gummed-up should ultimately stay the Bank’s hand,” he said.

Currently, financial markets are pricing in the equivalent of three 25 basis point increases through the June meeting, and a total of at least seven hikes by year’s end.

Financial market participants have been mulling the potential for larger-than-normal rate increases in the wake of U.S. Federal Reserve Chair Jerome Powell’s signal that a 50 basis point hike is not off the table at the Fed’s May meeting.

The size and pace of rate increases has come into sharp focus as both Canada and the U.S. grapple with inflation figures not seen in more than three decades.