GoCs Bull Steepen Post-BoC

Front end outperformance in GoC’s post-BoC cut, with the U.S. Tsy market reaction to the ISM services data making the outperformance vs. U.S. Tsys even more pronounced, although tempering the initial move lower in GoC yields.

• Yields run 1-8bp lower. 2s break to fresh multi-month lows, while yields further out the curve fail to test their March lows.
• The BoC Statement and decision was toward the dovish end of expectations given some were looking for a delay to easing, and the statement including a reference to potential future cuts also leans on the dovish side. Focus shifts to the upcoming press conference.