A lot of folks out there were skeptical that the big banks would show borrowers love and pass along the full Bank of Canada rate cut.Us included. But banks showed they still have a heart and did us right. RBC led the charge by slashing its prime rate 50 basis points to 3.45%. The rest of the bank herd then...
Amid a global growth scare, the BoC has slashed Canada’s most-watched rate for the first time in almost five years. “…The COVID-19 virus is a material negative shock to the Canadian and global outlooks,” the Bank said in its statement today. Despite how concerned the bank is about fuelling more debt, it chopped its overnight target by 50 bps to...
The global viral crisis is proving incredibly fluid. Traders have suddenly and drastically altered their expectations of how the Bank of Canada will react to this exploding economic threat. At the time this is being written, the market is predicting a 68.3% likelihood of a BoC cut next week. It’s fully pricing in a cut by April 15. Source: Bloomberg...
Rates are breaking out. Canada’s widely watched 5-year bond yield just hit a seven-month high. That’s typically bullish for fixed mortgage rates. Trendsetter RBC wasted no time this morning. It ran a press release announcing it was boosting 3-, 4- and 5-year fixed rates by 10, 20 and 20 bps, respectively. RBC doesn’t usually issue press releases when it’s merely...
Canada just witnessed its worst spike in unemployment since the Great Recession of 2009. An estimated 71,200 jobs were lost in November. And we all know what happens when unemployment bottoms and starts climbing. Rates usually drop. Is This Really the Bottom in Unemployment? No one knows what tomorrow will bring (until tomorrow).But here’s what we know: Economic cycles have...
There’s no industry-wide data on this, but whenever prime rate starts climbing, lenders tell us that at least 1 in 20 variable-rate borrowers lock in (convert) their variable rate to a fixed rate.And a good number of those borrowers are getting one stinkybum biscuit of a rate. One poor mortgagor I spoke with recently asked his lender to lock in....
It’s got the best 1-year rate in the country. It’s got the best conventional 2-year rate in the country. It’s got the best 3-year rate in the country. It’s got the best 4-year rate in the country. It’s got the best conventional 5-year fixed refinance rate in the country. It’s got the best variable rate at 80% loan-to-value in the...
The latest intel from Canada’s mortgage market… Rates Bounce Bigly Canada’s 5-year bond yieldcatapulted to 1.53% on Friday. Its 11-basis-point gain was the biggest since June 2017. That establishes at least a short-term bottom and suggests the best fixed mortgage rates probably won’t drop much more near-term. In fact, if yields close up in the 1.60’s, the lowest 5-year fixed...
In a normal universe, people who lock in a floating-rate mortgage lock into a fixed rate. And that fixed rate is almost always higher than their current variable rate. But this is not a normal universe. In the world we now live in, variable borrowers are actually locking into five-year fixed rates that are lower than their current rate. For...
Not much going on this weekend. Only a little meeting between the world’s two most powerful leaders about 2019’s single most important economic issue. U.S. prez Trump and Chinese supreme head communist guy, Xi, collide over trade ahead of Saturday’s G-20 summit in Japan. And, batten down the hatches, because it has the potential to be a short-term tide changer...
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