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GoCs Bull Steeper With Macklem & Jobs Report Eyed

CANADA
  • GoCs are bull steeper today with yields -1bp and -3bps lower on the day, mostly in line with Tsys at the front end but otherwise continuing yesterday’s outperformance further out the curve.
  • The 2-4bp rally across the BAX curve chips away at yesterday’s sell-off which we suspect was more induced by US ISM Services and less so the BoC decision. The BAU3/Z4 spread widens 3bps to -59bps but still points to relatively low levels of inversion by this year’s standards.
  • Gov. Macklem gives the Economic Progress Report later on, kickstarted by prepared remarks being released at 1355ET. Increased data dependency likely sees greater focus on tomorrow’s labour data.

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