Bank of Canada Maintains Prime , Hints at Future Increases

The Bank of Canada yesterday maintained it’s key overnight lending rate at 1%, holding the Prime rate on which Variable rate mortgages are based at 3%. In their press release, they listed several factors being considered in the decision…. “Overall, economic momentum in Canada is slightly firmer than the Bank had expected in January.” “…The […]

Mortgage Rate Expectations fading fast

Canadian Mortgage Rate Forecast (from Over the past few months, major economists have backpeddled on their rate hike predictions. Not long ago, the consensus of economists was projecting a July 19 increase. Now, those same analysts aren’t looking for a rate bump until this fall…or later. Here’s a chart from BMO illustrating how fast rate […]

Bond Yields Retreat – Could fixed rates also?

The 5-year government bond yield has dropped over 0.30% from the almost 2 year high set a few weeks ago. Those of you that are technical chart watchers may have noticed that the 5 year government bond yield has started to trend down towards a support level.  The expected support level is around 2.75-2.80% (i.e. the long-term […]

Fixed Rates Rising Again

RBC and Scotia announced yesterday another 0.25% increase across all fixed rate mortgage terms. The Canadian 5 year bond yield currently sits at 3.06%. From the Financial Post article that we quoted yesterday in this blog: “Banks like the difference between the five-year bond yield and their best – not the posted – five-year mortgage rate to […]

Fixed Rates Holding Steady – Variable still the best deal!

A look at the current 5 year bond yields shows a bit of weakening, but still close to the 14 month highs that is causing us to be concerned about fixed mortgage rates. Govt. of Canada benchmark bond yields: 5 year This said, we have also recently seen the December Jobs Reports show at best […]

Job Reports – Impact on Interest rates remains inconclusive

This morning’s announcement in both Canada and the US regarding December employment statistics was disappointing (Canada’s Economy Sheds 2600 Jobs, US Economy Sheds 85000 Jobs) compared to the predictions for growth of 20000 jobs in Canada, but not disastrous. Commentary on this news is flat: BMO Economist – “The details of the report were mixed, with […]

Interest Rates rising: 5 Year Bond Yields approaching 1 year+ high

The 5 year government bond yield which helps to determine discounted 5 year mortgage rates is again on the rise after a significant drop in November (and corresponding decrease in fixed term rates) and is now approaching highs that it has not achieved in more then a year. See More on Government of Canada Bond […]

More news on Interest Rates – Variable vs Fixed

On December 8th, I wrote about the BoC announcement that, barring significant changes in the outlook for inflation, it is keeping interest rates unchanged until June 30th of 2010. This messages has been consistent from the BoC for some time. On Dec 10th, the BoC Governor Mark Carney Quoted in the press discussing the amount […]