Ex-Pimco Manager Devlin Bets on Steeper Yield Curve in US, Canada

Fund manager Devlin Capital Inc. is getting ready for further steepening in the yield curve in North America’s two largest economies as governments run large budget deficits to pay for tax cuts, military projects and other priorities.

Founder Ed Devlin, formerly Pimco’s head of Canadian portfolio management, said both countries will see a flurry of long-dated bond issuance, even as their central banks run easier monetary policy. The US Federal Reserve trimmed rates again Wednesday while the Bank of Canada held its overnight rate at 2.25%, the lower end of what it considers “neutral” monetary policy.