Bonds are a type of investment that involves lending money to a borrower in exchange for interest payments over a set period of time.

The interest rate on a bond can influence the interest rate on a mortgage in several ways.

First, when bond yields rise, mortgage lenders may have to pay more to borrow money from the bond market. This can cause mortgage rates to rise, as lenders pass on the cost of their borrowing to their customers.

Conversely, when bond yields fall, mortgage lenders may be able to borrow money at a lower cost, which can cause mortgage rates to decrease. This is because lenders can offer lower interest rates to customers and still make a profit on their loans.

It's worth noting the bond market is just one of many factors that can influence mortgage rates in Canada. Other factors that can affect mortgage rates include the strength of the economy, housing market conditions, and demographic trends.