The Bank of Canada on Wednesday left its key overnight interest rate unchanged at 0.25%, as expected, and said the Canadian economy was proving to be more resilient than anticipated to the second COVID wave and containment measures.
Yields in 10-year bonds were one basis point higher at 1.78%. They reached a 23-month high of 1.97% on Feb. 26 on bets of rate hikes as early as next year. Bond futures were also stable at 98.229.
"It's also the culmination of a re-rating of commodities in general, driving the view that the global recovery and reflation brings the potential for further gains in commodity currencies."
The central bank left its cash rate at a record low 0.1%, but surprised by extending its bond-buying scheme by another A$100 billion ($76.01 billion) from mid-April.
Three-year bond yields at 0.12% remain pinned near the RBA's target of 0.10%, while commercial bank balances at the central bank have ballooned to over A$139 billion as it keeps the system flush with cash.
8 US gross domestic product data is due later on Thursday to gauge the strength of the world's largest economy as it struggles with the coronavirus pandemic.
The Chinese yuan clung to modest gains in offshore trade at 6.4757 to the dollar ahead of a monthly interest rate fixing where traders expect no change in either one-year or five-year loan prime rates.