By The Canadian Press Wed., Jan. 16, 2019 TORONTO - Royal Bank of Canada has lowered its posted five-year fixed rate by 15 basis points from 3.89 per cent to 3.74 per cent. Mortgage rate comparison website founder Robert McLister says RBC is the first of the Big Six banks to cut its advertised five-year fixed rate after a fall in five-year bond yields. McLister adds that he expects other big banks to follow suit in the coming days. When asked what prompted the rate drop, an RBC spokesperson said a number of factors have impacted the Toronto-based bank’s cost of funds. RBC says that includes the rate the bank pays in the wholesale market, increasing regulatory costs and market volatility. Article Continued Below McLister says now that market volatility has subsided, the bank’s competitors have started undercutting big banks which puts pressure on them to act. Companies in this story: (TSX:RY) Report an error Journalistic Standards About … [Read more...] about RBC cuts 5-year fixed mortgage rate, other banks expected to follow
5 year canada bond
By Esteban Duarte Bloomberg Wed., Dec. 5, 2018 Canada’s government bonds rallied and the loonie tumbled after the nation’s central bank pointed to signs of slower-than-expected growth as it left borrowing costs unchanged, leading traders to trim bets for a rate rise in January. The yield on the country’s two-year government bond fell as much as 7.4 basis points to a two month low of 2.044 per cent, the biggest slide since May, while the Canadian dollar sank to the weakest since mid-2017. The market-implied probability that the Bank of Canada raises rates next month declined to about 37 per cent from about 55 per cent Tuesday, based on OIS. “A January rate hike may not occur,” said Maria Berlettano, head of Canadian government credit strategy at CIBC. “The rate decision was as expected, but the statement was dovish. The statement acknowledged some new growth concerns and also suggested that there may be additional room for … [Read more...] about Canada bond yields tumble as Bank of Canada takes dovish stance
By Gordon Pape Special to the Star Fri., Nov. 23, 2018 Interest rates are rising. When that happens, bond prices drop. It’s one of the basic rules of investing. But how is that playing out in today’s investment climate? You may be surprised. The Bank of Canada has raised interest rates three times this year, with another quarter-point move possible in December. You would normally expect that such aggressive action would significantly knock down bond prices. However, the FTSE Russell Canadian Universe Bond Index was down only 0.12 per cent year to date as of the Nov. 16 close. In other words, only a tad below break-even. Government bonds took the biggest hit, off 0.22 per cent as a group. Corporate bonds were actually ahead 0.16 per cent. Not big numbers either way. And what about stocks? To that point, the S&P/TSX Composite Index was down 6.5 per cent for 2018. Where would you have rather had your money? Mutual fund returns reflect a similar … [Read more...] about Rates are heading up. Time to buy bonds?
By Greg Quinn Bloomberg Fri., Aug. 3, 2018 OTTAWA — Canada’s merchandise trade deficit narrowed more than forecast as oil producers and aircraft makers led exports to a record high. Even after the U.S. imposed tariffs on steel and aluminum, Canada’s trade gap narrowed to $626 million ($481 million US) in June, down from $2.7 billion a month earlier, Statistics Canada said Friday in Ottawa. Economists surveyed by Bloomberg predicted a deficit of $2.3 billion. Exports rose 4.1 per cent to $50.7 billion, with energy shipments up 7.1 per cent to the highest since 2014 and aircraft sales jumping by almost 45 per cent. The return of several Canadian refineries to production after shutdowns also played a role in the 0.2 per cent decline in imports as demand for foreign gasoline tumbled. “Canadian trade was a large and pleasant surprise in June, and a surge in exports for the month capped a solid quarter,” Canadian Imperial Bank of Commerce … [Read more...] about Canada overcomes Trump’s metal tariffs with record exports
By Maciej Onoszko Bloomberg Thu., July 19, 2018 If there ever was a time for corporate Canada to be more adventurous in the bond market, it’s now. Yields on 30-year government debt have plunged to more than a decade-low relative to the short end in the wake of the Bank of Canada’s latest interest rate hike. That means there’s plenty of opportunity for issuers to lock in low borrowing costs for longer, especially since demand for long-term debt is “absolutely huge,” as central bank Governor Stephen Poloz said last week. Yet corporate issuance of long-term bonds is lower this year than in 2017, even though the spread between two-year and 30-year bonds was more than 75 basis points wider a year ago and bond sales across all maturities are heading for a record this year. “There is an old expression: ‘Feed the ducks when they are quacking,’ ” said Jeff Herold, who oversees $2 billion as chief executive officer of … [Read more...] about It’s time for Canada to get adventurous with bonds