GOVERNMENT OF CANADA BOND YIELD CURVEAs of —

The curve every investor watches.

2-YEAR—%Short-term Government of Canada

5-YEAR—%★ Drives 5-yr fixed mortgages

★

10-YEAR—%Long-term benchmark

30-YEAR—%Ultra-long bonds

★ WHAT THE SHAPE MEANS ★

Reading the curve

↗ NORMAL CURVELong > Short

Healthy economy. Investors demand more yield to lend longer. Standard environment.

→ FLAT CURVELong ≈ Short

Transition signal. Often appears before a downturn — investors uncertain about growth.

↘ INVERTED CURVEShort > Long

Recession warning. Predicted every US recession since 1955. Less reliable in Canada but still watched.

★ WHAT EACH MATURITY DRIVES ★

2YRShort-term variable rates · GICs · cash flow planningShort-term loans, 1-2yr GICs

5YR5-yr fixed mortgages — the most important rate for Canadian homebuyers90% of fixed mortgages

10YRLong-term mortgages · government borrowing · pension fundsLong bonds, balanced portfolios

30YRInsurance company liabilities · DB pension funding · ultra-long-term planningInsurance reserves