30.04.202614:35:58UTC+00Canada 10-Year Bond Yield Down on Subdued GDP

The yield on Canada’s 10-year government bond eased to 3.56%, down from a two-year high of 3.61% on April 29th, as falling oil prices and soft GDP data weighed on expectations of an overly restrictive Bank of Canada policy stance. New figures showed that Canadian GDP was flat in March, suggesting that elevated energy prices have started to dampen overall spending. This outcome is consistent with the Bank of Canada’s latest policy decision, in which it held interest rates steady and indicated that the inflation outlook remains stable, noting that higher energy prices have not yet disrupted household inflation expectations. At the same time, a sharp increase in average earnings in March has reduced the urgency for the central bank to begin cutting rates this year.