Bond Yield For Wednesday, July 8, 2009
Canadian 5 yr bond yields -.00bps to 2.41- Four weeks ago it was 2.68. The spread, based on 5 yr rate of 4.49%, is at 2.08%.
Pressure on fixed 5 year: Down.
Financial Post – Markets. Lenders typically like to keep a spread of 1.70% to 1.80% between their fixed five year rates and the current 5 year bond yield. 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.
