Yields still climbing on U.S. jobs data

Fixed mortgage rates have run into serious funding cost pressure. Canada's 5-year bond yield and 4-year swap rate were both up another 13 bps Monday.

That leaves us about 25+ bps higher following Friday's U.S. employment numbers, which rose by nearly triple Wall Street estimates.

Investors had become too one-sided in their expectations of rate cuts this fall. Friday's data was a wake-up call. Sudden narrative changes like this can lead to powerful yield moves with ample carry through. In today's case, market rates are rising up to their downtrend line — so they may very well bounce off it (i.e., reverse lower).