Bond Yield For Monday, June 29, 2009
Canadian 5 yr bond yields -.03bps to 2.49- Four weeks ago it was 2.52. The spread, based on 5 yr rate of 4.49%, is at 2.00%.
Pressure on fixed 5 year rate: down.
Financial Post – Market. Lenders typically like to keep a spread of 1.70% to 1.80% between their fixed five year rates and current bond yields. If the bond yield increases then the spread will shrink putting upward pressure on mortgage interest rates. The reverse is also true. If bond yields decrease then the spread widens and there is downwards pressure on fixed rate mortgages.
