Daily Pulse

One of our most accessible tools, this daily comment keeps you abreast of developments on the North American and international financial markets.

Michel Doucet

Michel Doucet
Vice-President and
Portfolio Manager

October 4, 2023


Canada is unable to escape the global bond selloff, with 10-year yields surging about 24bps Tuesday. The rate reached 4.29%, the highest level since 2007, the same as Treasuries. Yields took off as the market reopened following a holiday on Monday. A Bank of Canada official said there’s a risk firms will continue to raise prices more frequently and more sharply, complicating efforts to bring inflation back to 2%. The higher local yield is failing to help the currency much, which is down against its US counterpart. The S&P/TSX Composite Index is extending its lowest levels of the year.

The Canadian dollar declined against a broadly stronger greenback as Treasury yields rose, with investors weighing the long-term effects of rising borrowing costs. “Factors have moved against the CAD over the past few sessions—USD/Canada spreads have widened and crude oil prices have fallen but the move still looks exaggerated to an extent,” said Shaun Osborne, chief foreign-exchange strategist at Scotiabank. “Canadian data prints this week need to reflect some resiliency in Canadian growth to help steady the exchange rate”

United States

Yields on 30-year Treasuries hit 5% for the first time since 2007 — and some are warning the 10-year is next. Yields on the benchmark reached 4.88% today. The trend will reverse only if US labor market data disappoints.

US job openings unexpectedly increased in August, fueled by a surge in white-collar postings, highlighting the durability of labor demand. The number of available positions increased to 9.61 million from a revised 8.92 million in July. Hiring edged up, while layoffs remained low. Hiring edged up, while layoffs remained low. The data precede Friday’s monthly jobs report, which is currently forecast to show employers added 170,000 jobs in September. The unemployment rate is expected to decrease slightly after a pickup in participation in August.

Kevin McCarthy's ouster as House speaker adds to market turmoil, with political uncertainty increasing the risk of a US ratings downgrade, strategists said. The next speaker will probably be "under even more pressure" than McCarthy was on funding issues, Goldman said. The House is expected to hold elections Oct. 11; Patrick McHenry took over as acting speaker.


Euro-area retail sales slumped in August, the 1.2% month-on-month drop more than double economist expectations. The final reading of the September services PMI came in stronger than initially estimated at 48.7, but still showed contraction.

Barely a year ago, Prime Minister Rishi Sunak took over a government in free-fall, shunned by the markets and riven by internal squabbling. The task facing him may be even harder now. Sunak is slated to take the stage Wednesday in Manchester for what is shaping up to be the biggest speech of his political career. The premier is expected to lay out his plan to “fundamentally change” Britain in a keynote address to the ruling Conservative Party’s annual conference.The address is Sunak’s best chance for a reset in the eyes of voters ahead of a general election widely expected next fall.


The European Union has formally launched an anti-subsidies probe into electric vehicles manufactured in China, setting in motion a one-year investigation that could see provisional measures such as countervailing duties imposed in the next nine months. The probe, which was announced by European Commission President Ursula von der Leyen last month, will focus on new battery-powered electric vehicles (BEVs) and alleged subsidies granted by the Chinese state. Though narrow in scope, the investigation focuses on a major global industry that has seen a massive rise in exports from China in recent years.

The yen surged from the weakest levels in a year versus the dollar amid speculation that Japanese officials were acting to slow the currency’s slide. Japan’s currency reached 150.16 per dollar on Tuesday in New York trading, its cheapest since multidecade lows set in October 2022, as a report showing US labor demand remains resilient pushed Treasury yields higher. The yen then soared nearly 2% in a matter of seconds to as strong as 147.43 per dollar. While the abrupt moves fueled chatter across Wall Street about possible intervention, analysts also pointed to other explanations, such as standing orders to sell dollars at the 150 level because of the threat of official action.

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