Monthly report
High yield credits top performance table in 2024
Markets are assessing more US fiscal stimulus and possible trade tariffs, after President-elect Trump’s election victory. Higher for longer US rates and a strong dollar remain the dominant narrative. The Canadian economy is forecast to recover in 2025, but trade tariffs are a risk. High yield credits dominated performance in 2024 but long duration assets lagged.
Key highlights:
- Macro and policy backdrop – A bold 50bp cut brings relief to consumers
- Canadian governments – Canadian yield curve flattened versus 6M ago
- Canadian credit – US and Canadian IG corporate yields diverge
- Global yields and spreads – Higher for longer rates hit long duration hardest
- Sovereign and climate bonds – Duration is a challenge for SI sovereigns
- Performance – High yield credits outshine other assets in 2024
This report provides actionable insights on currency-adjusted performance, macro drivers, shifts in yields, spreads and curves across conventional, inflation-linked and corporate bonds within the Canadian fixed income market.
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