For the mortgage market, that’s a signal that the central bank’s rate-cutting cycle, which began in 2024 but has slowed this year, may have already ground to a halt.
And that could have big implications for the fixed-vs-variable debate, with continuing economic volatility this year already pushing many Canadians towards fixed-rate mortgages.
“There’s always going to be a lot of predictions and forecasts but really no-one knows what’s going to happen even next month, a couple of months from now, or next quarter,” Victor Tran (pictured top), a mortgage agent with Tango Financial and RATESDOTCA housing and mortgage expert, told Canadian Mortgage Professional.
“But certainly with the news circulating around the media stating that the Bank of Canada may be done dropping rates… and they’re going to hold for a little while and things are going to start to increase again, that definitely worries a lot of Canadians shopping around for a mortgage. So they would be leaning towards fixed rates for that stability.”
Fixed-rate outlook gets another boost
There’s currently not much difference between one-to-five-year fixed rates and five-year variable rates, with both typically sitting in a range between the high threes and low fours.