The recession narrative started gaining more traction after U.S. inflation data were released, causing U.S. equities to drop as investors favoured bonds. Canadian equities experienced a harsher drop after the Bank of Canada raised its overnight target rate by 100 basis points.
Bond-yield volatility increased after U.S. inflation data were released, and the curve has started to invert. Yields are down on long-term bonds due to a significant spike in demand for safe-haven investments amid recessionary concerns.
The oil selloff continued for a third week, causing the price of oil to fall below US$100. Prospects for global growth remain dim alongside falling copper prices.