The Canadian provinces of Alberta and Quebec could plausibly hold referenda on sovereignty in the next six to 12 months -- with the Alberta referendum now likely to be held mid-October, and the Quebec provincial election possibly in early October, with the separatist Parti Quebecois modestly favored to win, said Rosenberg Research.
Neither referendum is likely to receive majority support, as public support remains below 30% on average, noted Rosenberg Research.
In addition, the Alberta referendum wouldn't be legally final even if -- hypothetically -- it were to pass, due to statutory and constitutional issues, stated Rosenberg.
Quebec and Alberta bond spreads have modestly widened in the last few months, reflecting elevated risks, it added.
The 1995 Quebec independence referendum created significant volatility in both federal and Quebec provincial bond spreads, which widened as the referendum date drew closer.
These events will create event-driven volatility in fall 2026, and are a bearish pressure on the Canadian dollar (CAD or loonie), according to Rosenberg. The bond market implications net out to be relatively "small" and don't change Rosenberg's bullish call on two-year Canadian bonds.