Today on the show, we welcome Portfolio Manager Sri Tella. He discusses his outlook for Canada’s bond markets, and the opportunities for fixed income following the latest Bank of Canada interest rate announcement. Sri notes that the BoC hinted at concerns regarding inflation, contributing to the uncertainty surrounding rate cut decisions. Shelter in particular is expected to contribute roughly 50% to inflation over this year. There were no indications of rate cuts given to the market, and some cuts have been priced out of the market which suggests a potential delay in the magnitude of future cuts. Sri also outlines the bond market sectors that he now sees as most attractive. Provincial bonds, securitized products and the energy sector are currently favored due to factors such as historical valuations, short duration combined with high spreads, and stability respectively. 

Recorded on March 7, 2024.

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