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Canadian 10-year yields ease after US inflation cools rate-hike odds
The Canadian dollar held near a two-month high versus the US dollar as the 10-year yield fell from a May 2024 peak and the loonie hovered around 1.3940 per greenback.
Canadian bond yields eased across the curve and the Canadian dollar held close to a two-month high against the US dollar on Wednesday after US inflation data reduced the likelihood of a Federal Reserve rate hike at its next meeting, Reuters reported.
The Canadian 10-year yield was down 2.3 basis points to 3.685%, after touching 3.755% earlier, the highest level since May 2024, while the 2-year yield rose 16 basis points over the past month.
Over the same period, Canada’s 10-year yield climbed about 17 basis points, the most among G7 sovereigns, as jobs, trade, and GDP data pointed to a domestic recovery after a slow start to the year, according to Reuters.
Separately, Canada saw domestic momentum with building permits rebounding 18.5% in June after declines in April and May, Reuters added, and oil edged down to $83.11 a barrel as forecasts for 2026 global demand were cut and Middle East shipping risks continued.