Canadian Yields Rise on Fed Outlook

2026-06-17 20:53 By Isabela Couto 1 min. read

Canada's 10-year government bond yield rose slightly to around 3.4% after the Federal Reserve struck a more hawkish tone at its latest meeting.

As widely expected, the Fed left interest rates unchanged, but its projections were viewed as more hawkish than anticipated, with roughly half of FOMC members expecting at least one rate hike this year.

The Fed also raised its inflation forecasts, prompting investors to scale back expectations for monetary easing and putting upward pressure on North American bond yields.

Meanwhile, the BoC kept its key interest rate unchanged at 2.25% at its latest meeting.

The central bank said uncertainty remains elevated amid tensions in the Middle East and new US tariff proposals, but reiterated that it stands ready to act if needed and will not allow higher energy prices to trigger persistent inflation.

Investors largely expect the BoC to raise borrowing costs by 25 basis points in December.



News Stream
Canadian Yields Rise on Fed Outlook
Canada's 10-year government bond yield rose slightly to around 3.4% after the Federal Reserve struck a more hawkish tone at its latest meeting. As widely expected, the Fed left interest rates unchanged, but its projections were viewed as more hawkish than anticipated, with roughly half of FOMC members expecting at least one rate hike this year. The Fed also raised its inflation forecasts, prompting investors to scale back expectations for monetary easing and putting upward pressure on North American bond yields. Meanwhile, the BoC kept its key interest rate unchanged at 2.25% at its latest meeting. The central bank said uncertainty remains elevated amid tensions in the Middle East and new US tariff proposals, but reiterated that it stands ready to act if needed and will not allow higher energy prices to trigger persistent inflation. Investors largely expect the BoC to raise borrowing costs by 25 basis points in December.
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