The Mortgage Report: March 8 It was one year ago that Canada’s 5-year yield plunged to an all-time low of 0.27%. Since then, it has more than tripled — and the bond market hasn’t taken a breather. Investors keep dumping bonds and driving up yields. They fear things like: inflation excessive government borrowing and stimulus the end of government bond-buying...
The Mortgage Report: March 3 “Interest rate risk could rise if the economy outperforms expectations,” said RBC Economics on Tuesday, as the bank raised three of its special fixed rates: 3yr: 2.19% to 2.24% 4yr: 2.09% to 2.29% 5yr: 2.04% to 2.24% That leaves just CIBC with advertised 5-year fixed rates under 2.00%. But advertised and reality are two different...
Monday was a reprieve from surging rates in the bond market. Canada’s 5-year swap rate, a good lead indicator of fixed mortgage pricing, fell back towards earth after February’s parabolic surge. So far, four of the Big 6 banks have boosted fixed rates following that leap in funding costs. Here are some of the big names that jacked up fixed...
More banks raised their internal mortgage pricing this weekend, including Scotiabank. (See: Big Bank Mortgage Rates) Its move followed TD’s fixed-rate hike on Friday. Scotia, the largest bank in the mortgage broker channel, boosted multiple fixed rates, but actually lowered its variable rates. That seems to be the playbook now as banks try to entice people to float their mortgages...
If you’ve never seen B.C.’s Squamish Chief, it’s an imposing mass of sheer cliff. And Canadian interest rates look like they’re climbing it. The 5-year government yield, which leads fixed mortgage rates, is going straight up. It hasn’t moved this much within a nine-day span in a decade (November 2010, based on closing prices). At 0.94%, it’s now doubled since...
If you have faith in Canada’s top banker, Bank of Canada chief Tiff Macklem, you needn’t worry about prime rate rising in 2021. Here’s what he said in a speech on Tuesday:With a complete recovery still a long way off, monetary policy will need to provide stimulus for a considerable period. We have committed to keeping our policy interest rate...
People hear the Bank of Canada predicting no rate increases until 2023 and take that as gospel. Maybe they shouldn’t. The Bank of Canada’s key overnight rate—which more directly impacts floating-rate mortgages—doesn’t constrain fixed mortgage rates in the same way. The latter are driven more by what the bond market thinks the Bank of Canada (and the economy) will do...
A scattering of lenders are starting to warn of impending rate increases. No surprise—given Canada’s 5-year bond yield, which drives fixed mortgage rates, hit a new relative high on Thursday. At 0.60%, it’s now the highest it’s been since April 9, 2020. When the 5-year yield was last at these levels, your typical discretionary 5-year fixed rate at a Big...
The entire mortgage market was waiting, and now, after 10 months, it finally happened. Canada’s 5-year bond yield (which influences fixed mortgage rates) broke through major resistance, resistance that goes all the way back to April of last year. It’s a signal that better economic times lie ahead. A sign that inflation should no longer be just an afterthought. A...
We heard from a reader last week who was declined for a mortgage by a Big 5 bank. The problem was not with him, however. The problem was his banker’s ineptitude. Fortunately for Ralph (his name), he was particularly well-versed in the bank’s guidelines, having researched rental financing in the past. When the banker told him he was declined, Ralph...
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