Bonds had another good month in June, with the overall Universe returning 1.8% taking the year to date (YTD) return to 4.2%.
This month the mid and long end of the curve outperformed while the short end underperformed.
We also saw corporates slightly outperform governments overall, driven by the long end of the curve, and therefore corporates continue to hold a 42 basis point advantage on the YTD returns.
Here are the numbers:
June YTD
Universe: 1.8% 4.2%
Universe (Gov’t): 1.8% 4.1%
Universe (Corp); 1.9% 4.5%
Short Term: 1.4% 2.2%
Short Term (Gov’t): 1.4% 2.1%
Short Term (Corp); 1.5% 2.4%
Mid Term: 2.4% 5.0%
Mid Term (Gov’t): 2.4% 4.9%
Mid Term (Corp); 2.3% 5.2%
Long Term: 2.0% 7.8%
Long Term (Gov’t): 1.9% 7.3%
Long Term (Corp); 2.5% 9.4%
As we saw last month, yields in June rose slighting month over month out to 1 year, while longer dated (1 year and beyond) Canada’s saw decreases in yields for the month ranging from 6 bps (at 12 months) to 37bps (at 2 years). The biggest decreases were concentrated in the 2 year to 10 year range.
Current Yields:
1 Month: 0.3 %
1 Year: 1.0 %
5 Year: 2.3 %
10 Year: 3.1%
Long: 3.7%
Note – Prime is 2.5% in Canada (3.25% in US) – no change in June.
