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Increasing Outperformance To Treasuries

CANADA
  • GoCs have seen growing outperformance to Treasuries since the open, tilted to the front end after yields were sent lower by yesterday’s notably high bid-to-cover in the 2Y auction before continuing after a pause for the BoC minutes (2Y -3.7bps, Tsys +0.9bp).
  • It pushes the Can-US 2Y yield differential to -56bps at levels from late Jan.
  • Little in today’s docket with local focus on tomorrow’s employment report with consensus for job growth pulling back after December’s surge, an uptick in u/e rate and softer wage growth.

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