The Canadian bond universe started 2011 on a negative note with a negative return of 44 basis points for the month of January.
This was primarily driven by the long end of the curve where we saw both government bonds and corporate bonds perform poorly. Meanwhile, corporates outperformed governments across the entire yield curve.
Here are the numbers:
Jan.31st YTD Universe: -0.4% -0.4% Universe (Gov’t): -0.6% -0.6% Universe (Corp): 0.0% 0.0% Short Term: 0.3% 0.3% Short Term (Gov’t): 0.2% 0.2% Short Term (Corp): 0.4% 0.4% Mid Term: -0.4% -0.4% Mid Term (Gov’t): -0.6% -0.6% Mid Term (Corp): 0.1% 0.1% Long Term: -1.9% -1.9% Long Term (Gov’t): -2.1% -2.1% Long Term (Corp): -1.1% -1.1%For the month of January, we had yields moving down slightly for maturities less than one year; while for the year 2 bond and longer we saw yield increases ranging from plus 2 basis points (2 year) to plus 23 basis points (long bond).
Current Yields (as at January 31st): 1 Month: 0.9% 1 Year: 1.3% 5 Year: 2.5% 10 Year: 3.3% Long: 3.8% The Prime Rate in Canada remains at 3% (3.25% in US). The next scheduled meeting is for March 1, 2011.
