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GoCs Underperform Treasury Bear Steepening

CANADA
  • GoCs have seen a one-way sell-off since the open, trading firmly bear steeper on the day with benchmarks 3.5-8.5bp cheaper and underperforming Treasuries by 1-2.5bps across the curve.
  • 2s10s sits at -75bps (+5bp) but remains off early October highs of -64bps.
  • Ahead sees producer prices at 0830ET landing alongside US jobless claims and the Philly Fed.
  • There is also C$4B of 10Y supply at 1200ET but expect market reaction to be firmly overshadowed by Fed Chair Powell’s comments released at the same time.

Canadian 2s10sSource: Bloomberg

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