BBC has just issued a new annual coupon bond that has 5 years to maturity, a coupon rate of 9%, and trades at par at a price of $1000. You may assume that the yield curve is flat.

The government has recently issued five series of zeroes (zero-coupon bonds) with 6 months, 1 year, 18 months, 2 years, and 30-month maturity horizons. If the bonds have respective prices of $966.18, $929.59, $891.1, $851.53, and $811.59 bootstrap the 1 year, 18 monthss,s and 2 years forward 6 month rates.

Identify if the 6-month forward-rate curve you computed above is in a state of backwardation, contango, or is flat.