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GoC Curve Holding Near Most Inverted Levels

CANADA
  • GoCs have built on a small sell-off at the open, with yields up circa 2bps across most of the curve.
  • In doing so it keeps the curve close to the most inverted it’s been this cycle, with 2s5s at -15bps and 2s10s at -18bps close to 2019 lows and prior to that not seen since the early 1990s.
  • Moving in lockstep with Tsys in absence of other drivers so far, Can-US yield differentials are holding close to recent lows after the BoC’s front-loaded hiking guidance triggered GoC outperformance.

GoC 2s10s (white) and 2s5s (pink) spreadsSource: Bloomberg

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