The Bank of Canada still has a constructive view on economic growth. They may be likely to raise interest rates more.
The Bank of Canada may raise the rate to 4 percent and pause. Initial reaction is a weaker Canadian dollar.
The (Bank of Canada is) priced for 4 percent and this is consistent with that right now, although they are in data-watching mode.
You have firm inflation. The Bank of Canada has to continue tightening to keep it in check. Clearly it makes 4.25 percent more likely than 4 percent.
The simple fact that the trade sector has ceased to be a significant drag on growth will be enough to convince the Bank of Canada to move on September 7 (and beyond).
Usually Canadian data doesn't mean that much but we were so close to testing the previous (dollar/Canada) lows that when we got better productivity numbers it gave the market a push.
The economy is firmly in expansion mode so the Bank of Canada will take rates higher. Higher short-term rates will push up yields.