Canadian households and businesses could continue facing higher long-term borrowing costs as the effects of U.S. tariffs ripple through financial markets.

Farm Credit Canada says rising U.S. inflation and increased risks surrounding government debt have helped push American bond yields higher.

Those increases are also affecting Canadian bonds because of the close connection between the two markets.

FCC says the impact could be felt through fixed mortgage rates and long-term business financing, including for Canada’s agriculture and food industry.