Canada 10-Year Yield Eases on Soft Core Inflation

2026-06-24 14:43 By Isabela Couto 1 min. read

Canada’s 10-year government bond yield fell below 3.40% in late June, the lowest in over three months, as evidence of low underlying inflation backed expectations that the Bank of Canada will refrain from raising rates this year.

Core inflation measures tracked by the Bank of Canada remained close to the central bank’s 2% target in May, despite a surge in energy prices during the period.

The reading aligned with the BoC’s earlier view that the conflict in Iran may have only transitory effects on headline inflation.

The BoC kept its key interest rate unchanged at 2.25% at its latest meeting and signaled that risks remain balanced across its inflation and employment mandate amid an uncertain economic backdrop.

Meanwhile, the US Federal Reserve adopted a more hawkish tone at its latest meeting by projecting rate hikes by December.

The shift prompted investors to scale back expectations for monetary easing, limiting declines in North American bond yields.



News Stream
Canada 10-Year Yield Eases on Soft Core Inflation
Canada’s 10-year government bond yield fell below 3.40% in late June, the lowest in over three months, as evidence of low underlying inflation backed expectations that the Bank of Canada will refrain from raising rates this year. Core inflation measures tracked by the Bank of Canada remained close to the central bank’s 2% target in May, despite a surge in energy prices during the period. The reading aligned with the BoC’s earlier view that the conflict in Iran may have only transitory effects on headline inflation. The BoC kept its key interest rate unchanged at 2.25% at its latest meeting and signaled that risks remain balanced across its inflation and employment mandate amid an uncertain economic backdrop. Meanwhile, the US Federal Reserve adopted a more hawkish tone at its latest meeting by projecting rate hikes by December. The shift prompted investors to scale back expectations for monetary easing, limiting declines in North American bond yields.
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