The Canadian bond prices gained on Friday as consumer price data suggested a lack of inflationary pressures, but pulled back as the session came to a close. "The decline in the yields in the bond markets actually started before the inflation numbers came out, so I think they just had the effect of continuing the trend," said Carolyn Kwan, financial markets economist at Scotia Capital.
The two-year bond rose 2 Canadian cents to C$100.39 to yield 2.790 percent, while the 10-year bond was up 13 Canadian cents at C$109.41 to yield 3.749 percent.
The yield spread between the two-year and 10-year bond moved to 95.9 basis points from 96.8 at the previous close.
The 30-year bond rose 30 Canadian cents to C$124.75 to yield 4.231 percent. In the United States, the 30-year treasury yielded 4.223 percent.
The three-month when-issued T-bill yielded 2.46 percent, unchanged from the previous close. The Canadian dollar finished little changed against the US currency on Friday, shrugging off both inflation data and remarks by Finance Minister Ralph Goodale.
The currency finished at C$1.2325 to the US dollar, or 81.14 US cents, down slightly from C$1.2319 to the US dollar, or 81.18 US cents, at Thursday's session close.
The currency moved little after Statistics Canada said consumer prices rose 1.6 percent in May, slightly less than expected.
That confirmed analysts' opinions that no immediate rate hike is in store, though they said the Bank of Canada would still have to tighten monetary policy at some point.
The loonie stuck to a moderate trading band for much of the session, moving between C$1.2268 and C$1.2348.
"The Canadian dollar is moving sideways," said Jeremy Friesen, senior currency strategist at RBC Capital Markets.
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