Interesting, so you think it's only loose based on bond rates? When I plot my own records of 5 year GIC rates against bond yields, it looks awfully similar. At least in shape.GIC rates are loosely based on bond rates. If you do a historical comparison of 5 year rates, the gap is typically 50-100 bp and sometimes outside those endpoints. Mortgage demand (or lack thereof) influences that relationship considerably, as in now, demand has caused the spread to be150bp at the 5 year rate.
That's a good point though about potentially a 1% divergence between bond yields and GICs. I was only looking at historical shapes/trends but there could be a rather large offset between those yields.