The yield on the Canadian 10-year government bond slid below 3.5%, easing from its one-year high of 3.611% seen July 15th as it mirrored a broader rally in global bond markets driven by renewed US-China tariff concerns and uncertainty surrounding the Federal Reserve’s policy outlook, which boosted demand for safe-haven assets and pulled Canadian yields lower in tandem. Domestically, persistently high core inflation near 3% and strong job creation had supported yields earlier in July, but the softer 1.9% headline CPI reading for June and stable labor market conditions have reinforced expectations that the Bank of Canada will leave interest rates unchanged. At the same time, the latest Business Outlook Survey shows firms are less concerned about severe US tariff actions and report little change in inflation and employment expectations from the previous quarter.