MNI BRIEF: BOC Bond Holdings Below CAD200B, Half Covid Peak

The Bank of Canada's bond holdings have fallen below CAD200 billion, less than half the CAD435 billion peak set in in December 2021 at the height of QE during the pandemic.

Last week's report on the Bank's balance sheet lists bonds of CAD198.8 billion, part of a normalization over the next several years. Before the pandemic bond holdings were about CAD80 billion. The Bank declined to comment on its reduced holdings. 

Deputy Governor Toni Gravelle said in a March speech that settlement balances the Bank created to stabilize markets and boost the economy during Covid will also come back into a target range of CAD20 billion to CAD60 billion this year. (See: MNI: More BOC Secondary Debt Buys Mirror Best Practices- Memos)  

Conditions will permit the Bank to resume buying of treasury bonds it suspended during the pandemic next month, RBC strategist Simon Deeley wrote in a July 10 research note.