2019

2020

2021

Q1

Q2

Q3

Q4*

Q1F

Q2F

Q3F

Q4F

Q1F

Q2F

Q3F

Q4F

Canada

Overnight Target Rate

1.75

1.50

3-mth T-Bill Rate

1.67

1.66

1.65

1.53

1.40

2-yr Govt. Bond Yield

1.55

1.47

1.58

1.70

1.50

1.40

1.43

1.45

1.50

1.55

1.60

1.65

5-yr Govt. Bond Yield

1.52

1.39

1.40

1.64

1.55

1.50

1.55

1.60

1.65

1.70

1.75

1.80

10-yr Govt. Bond Yield

1.62

1.46

1.37

1.64

1.55

1.50

1.55

1.65

1.75

1.80

1.85

1.90

30-yr Govt. Bond Yield

1.89

1.68

1.53

1.73

1.65

1.60

1.70

1.80

1.90

2.00

2.10

2.15

10-yr-2-yr Govt Spread

0.07

-0.01

-0.21

-0.06

0.05

-0.06

0.12

0.20

0.25

U.S.

Fed Funds Target Rate

2.50

2.00

1.75

2.00

2.25

3-mth T-Bill Rate

2.35

2.08

1.84

1.53

1.55

1.68

1.93

2.17

2-yr Govt. Bond Yield

2.27

1.75

1.63

1.64

1.70

1.75

1.80

1.90

2.00

2.10

2.20

2.30

5-yr Govt. Bond Yield

2.23

1.76

1.55

1.71

1.75

1.80

1.90

2.00

2.10

2.20

2.30

2.40

10-yr Govt. Bond Yield

2.41

2.00

1.68

1.88

1.95

2.00

2.10

2.20

2.30

2.40

2.50

2.60

30-yr Govt. Bond Yield

2.81

2.52

2.12

2.30

2.35

2.40

2.50

2.60

2.70

2.75

2.80

2.85

10-yr-2-yr Govt Spread

0.14

0.25

0.05

0.24

0.25

0.24

0.30

Canada-U.S. Spreads

Can - U.S. T-Bill Spread

-0.68

-0.42

-0.19

0.12

-0.02

0.12

-0.15

-0.28

-0.53

-0.77

Can - U.S. 10-Year Bond Spread

-0.79

-0.54

-0.31

-0.24

-0.40

-0.24

-0.55

-0.60

-0.65

-0.70

F: Forecast by TD Economics as at December 2019. All forecasts are end-of-period.
Source: Bloomberg, Bank of Canada, Federal Reserve, TD Economics. *Spot rates as at December 16, 2019 with the exception of policy rates.

Interest Rate Outlook
	2019				2020				2021
	Q1	Q2	Q3	Q4*	Q1F	Q2F	Q3F	Q4F	Q1F	Q2F	Q3F	Q4F
Canada
Overnight Target Rate	1.75	1.75	1.75	1.75	1.75	1.50	1.50	1.50	1.50	1.50	1.50	1.50
3-mth T-Bill Rate	1.67	1.66	1.65	1.65	1.53	1.40	1.40	1.40	1.40	1.40	1.40	1.40
2-yr Govt. Bond Yield	1.55	1.47	1.58	1.70	1.50	1.40	1.43	1.45	1.50	1.55	1.60	1.65
5-yr Govt. Bond Yield	1.52	1.39	1.40	1.64	1.55	1.50	1.55	1.60	1.65	1.70	1.75	1.80
10-yr Govt. Bond Yield	1.62	1.46	1.37	1.64	1.55	1.50	1.55	1.65	1.75	1.80	1.85	1.90
30-yr Govt. Bond Yield	1.89	1.68	1.53	1.73	1.65	1.60	1.70	1.80	1.90	2.00	2.10	2.15
10-yr-2-yr Govt Spread	0.07	-0.01	-0.21	-0.06	0.05	-0.06	0.12	0.20	0.25	0.25	0.25	0.25
U.S.
Fed Funds Target Rate	2.50	2.50	2.00	1.75	1.75	1.75	1.75	1.75	1.75	1.75	2.00	2.25
3-mth T-Bill Rate	2.35	2.08	1.84	1.53	1.55	1.55	1.55	1.55	1.55	1.68	1.93	2.17
2-yr Govt. Bond Yield	2.27	1.75	1.63	1.64	1.70	1.75	1.80	1.90	2.00	2.10	2.20	2.30
5-yr Govt. Bond Yield	2.23	1.76	1.55	1.71	1.75	1.80	1.90	2.00	2.10	2.20	2.30	2.40
10-yr Govt. Bond Yield	2.41	2.00	1.68	1.88	1.95	2.00	2.10	2.20	2.30	2.40	2.50	2.60
30-yr Govt. Bond Yield	2.81	2.52	2.12	2.30	2.35	2.40	2.50	2.60	2.70	2.75	2.80	2.85
10-yr-2-yr Govt Spread	0.14	0.25	0.05	0.24	0.25	0.24	0.30	0.30	0.30	0.30	0.30	0.30
Canada-U.S. Spreads
Can - U.S. T-Bill Spread	-0.68	-0.42	-0.19	0.12	-0.02	0.12	-0.15	-0.15	-0.15	-0.28	-0.53	-0.77
Can - U.S. 10-Year Bond Spread	-0.79	-0.54	-0.31	-0.24	-0.40	-0.24	-0.55	-0.55	-0.55	-0.60	-0.65	-0.70
F: Forecast by TD Economics as at December 2019. All forecasts are end-of-period. Source: Bloomberg, Bank of Canada, Federal Reserve, TD Economics. *Spot rates as at December 16, 2019 with the exception of policy rates.