Yield Curve Inversion Hits Widest in Canada Since Early 1990s
- Spread between 10- and 2-year debt reaches 100 basis points
- Recession indicator flashing ahead of central bank decision
Parliament Hill in Ottawa, where the Bank of Canada will make its final policy decision of the year on Dec. 7.
Photographer: David Kawai/BloombergThis article is for subscribers only.
A key part of Canada’s yield curve is now at the steepest inversion since the early 1990s, a possible warning sign for the economy.
The yield on Canada’s benchmark 2-year debt reached 100 basis points above 10-year bonds on Monday. It’s the largest gap since the early 1990s, just as the country’s economy was plunging into a deep downturn. The two-year yield was just below 3.8% at 8:13 a.m. Toronto time.