Yield on Canadian Government Bonds Rising

May 29, 2013 Leave a comment

About three weeks ago, I speculated that the bottom on interest rates had come and gone, and interest rates were rising.

This now seems more and more certain. Because of Abenomics, yields on Japanese government bonds have shot up and set off an ugly chain reaction. Bond prices are falling and yields are rising. Rather quickly, I might add.

Take a look at these charts of yields for selected Canadian government bonds. Pay extra attention to the longer-term bonds.

First, marketable bonds. The average yield on 1-3 year bonds:

Government of Canada marketable bonds - average yield - 1 to 3 year

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Now 3-to-5 year bonds:

Government of Canada marketable bonds - average yield - 3 to 5 year

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5-10 year:

Government of Canada marketable bonds - average yield - 5 to 10 year

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Here’s the average for 10+ year bonds:

Government of Canada marketable bonds - average yield - over 10 years

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Now the benchmark bonds.

First, the 2-year:

Government of Canada benchmark bond yields - 2 year

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The 3-year:

Government of Canada benchmark bond yields - 3 year

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The 5-year:

Government of Canada benchmark bond yields - 5 year

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The 7-year:

Government of Canada benchmark bond yields - 7 year

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The 10-year:

Government of Canada benchmark bond yields - 10 year

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Long-term benchmark bonds:

Government of Canada benchmark bond yields - long-term

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Here’s the long-term real return bond yield:

Real return bond - long term

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You can draw your own conclusions from this data, I’m sure.

Filed under Banking and Finance, Economics, Interest Rates, Ottawa Tagged with , , , , , , , ,