CIBC Research discusses its reaction to today's Canada Q1 GDP.

"Statisticians threw the Bank of Canada a slight curveball ahead of tomorrow's policy decision, with growth in Q1 coming in at 3.1%, well below the consensus expectation and what was suggested by previously released industry data. That said, the growth rate in Q1 was still in line with the Bank's April MPR forecast, and the 0.7% monthly increase for March, combined with an advance estimate for a 0.2% gain in April, will leave Q2 GDP tracking not too far below the Bank's 6% forecast for that quarter," CIBC notes. 

"Moreover, with inflation continuing to surprise to the upside and the unemployment rate at historic lows, it still appears likely that policymakers will deliver two more 50bp hikes (tomorrow and at the July meeting), before slowing down and seeing how the economy is responding to those higher rates," CIBC adds.