Canadian Bonds are Starting to Underperform
Igor Manukhov - Jun 16, 2025
Canadian Bonds are Starting to Underperform their US and Global Counterparts. Time to start looking abroad.
Canadian Bonds have been doing well against the rest of the world over the last two years. The charts below show the relative strength of US bonds to Canadian bonds (green chart) and global bonds against Canadian bonds (red chart). The downward direction represents Canadian bonds outperforming.
Notice that both charts are advancing, meaning US and global bonds are starting to outperform Canadian bonds. While the longer-term trend still favours Canada (the blue lines on both charts represent a 30-week moving average, which are still going down), this could be a beginning of a new trend.
We will be adjusting our bond holdings to include more international exposure. Coincidentally, US bonds also pay much more than their Canadian counterparts at this moment.