The Canadian bond prices on Friday, which had followed the bigger US treasuries market all week given the lack of any domestic data, finished higher after the Canadian GDP report missed estimates.
Also adding to the rise in bond prices was data that showed Canadian producer prices fell by a sharper-than-expected 1 percent in August from July, while raw materials prices turned downward for the first time in January, declining 2.8 percent.
The Bank of Canada left C$1.039 billion in the Large Value Transfer System on Friday for the weekend, substantially more than the C$300 million it had targeted. It also plans to leave C$300 million in the system on Monday.
The two-year bond rose 16 Canadian cents to C$100.35 to yield 4.080 percent, while the 10-year bond jumped 45 Canadian cents to C$97.35 to yield 4.338 percent. The yield spread between the two-year and 10-year bond moved to 25.8 basis points from 23.4 at the previous close.
The 30-year bond gained 66 Canadian cents to C$109.39 to yield 4.428 percent. In the United States, the 30-year treasury yielded 4.833 percent. The three-month when-issued T-bill yielded 4 percent, down from 4.02 percent at the previous close.
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