Canada’s yield curve is finally starting to normalize — but short-term rates are still too high.

The Bank of Canada held at 2.75%, citing sticky core inflation and trade uncertainty. But the long end of the bond market is already moving.

A healthy curve would have short-term rates closer to 2%. That’s why many of us see room for 75 to 100 bps in future cuts.

Next decision: July. The curve is watching.

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