The Canadian ond prices were mixed on Friday as the strong September GDP seemed to confirm that Canada's economy is running in high gear, meaning that interest rates will keep rising. Safe-haven hopes gave some issues a last-minute boost.
"The bond market was strange today because in spite of all the strong data, you still got the market rallying. A lot of that may be quarter-end index buying," said Levesque.
"We'll see how it unfolds on Monday. The situation might reverse itself."
The two-year bond fell 3 Canadian cents to C$100.01 to yield 3.247 percent, while the 10-year bond gained 3 Canadian cents to C$103.98 to yield 4.483 percent.
The yield spread between the two-year and 10-year bond moved to 123.6 basis points from 125.3 at the previous close.
The 30-year bond, due 2029, rose 45 Canadian cents to C$111.15 to yield 4.959 percent. In the United States, the 30-year treasury yielded 4.791 percent.
The three-month when-issued T-bill yielded 2.62 percent, up from 2.60 percent at the previous close.
The Canadian dollar finished on Friday above the 82 US cent level for the first time in 12 years, underscored by jitters heading into next week's US presidential election and hopes of higher domestic interest rates.
The currency has hit the 82 US cent level a few times this week and fallen back. But on Friday it finished above that at C$1.2180 to the US dollar, or 82.10 US cents. That is up from C$1.2237 to the US dollar, or 81.74 US cents, at Thursday's close.
"The implications of potential geo-terrorism are out there right now going into the election," said Jack Spitz, director of foreign exchange at National Bank of Canada.
The Canadian dollar held its gains as al Jazeera television aired an address by Osama bin Laden, who accused George W. Bush of deceiving Americans and said the September 11 attacks would not have been as severe if the US president had been alert.
The tape was broadcast just days ahead of the US presidential election on November 2.
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