Tag Archive: interest rates


“This Time is for Real,” Says BofA

—The Mortgage Report: Oct. 13— If you like definitive-sounding rate calls, here’s one: “The 2020 recession AND the 40-year bond rally are over,” declares Bank of America. Positive economic data surprises, declining uncertainty post-U.S. election and “massive monetary and fiscal policy support” will “set the stage” for higher bond yields, the bank stated in a report on Tuesday. If true,...

The Chance of Negative Rates Remains

“We are not actively discussing negative interest rates at this point, but it’s in our toolkit and never say never.” Bank of Canada Governor, Tiff Macklem That comment from Canada’s monetary kahuna, Tiff Macklem, put a glimmer of hope in the eyes of variable-rate mortgagors this week. By leaving the door open to sub-zero rates, even if just a crack,...

Bank of Canada Re-Signals a Long Road to Recovery

Quick Rundown Today’s Announcement:No change to rates Overnight rate:0.25% Prime Rate:2.45% (also no change; seePrime Rate) Market Rate Forecast:No BoC hikes until at least 2023 BoC’s Headline Quote: “The Governing Council will hold the policy interest rate at the effective lower bound [intended to be 0.25%] until economic slack is absorbed so that the 2% inflation target is sustainably achieved.”...

Mortgage Rate Differentials: Unusually Narrow

—The Mortgage Report: Sept. 8— One of the most important factors determining your success with a mortgage is the rate, relative to other rates you could have chosen. Over the long run and other things equal: The higher your rate relative to other rate options, the worse your odds of success. The lower your rate relative to other rate options,...

Are Falling Rate Expectations Setting Up a Future Surprise?

—The Mortgage Report: Aug. 7— Rate Complacency When you survey people about the direction of interest rates, they consistently expect “that rates will rise,” says Mortgage Professionals Canada (MPC) in a new report. That thinking is partly why 5-year fixed rates are so popular. But MPC’s recent survey indicates “that the expected amount of increase might be the smallest we’ve...

Did the BoC Just Unleash the Bulls?

—The Mortgage Report: Weekend Edition— It Might as Well Have: On Wednesday, the Bank of Canada threw caution to the wind and changed its playbook. It pledged not to hike rates until “the 2 percent inflation target is sustainably achieved.” The significance of that statement is now sinking in and here’s why. Normally, the Bank of Canada doesn’t wait for...

Bank of Canada Holds Rates, Gives Mortgagors Confidence

Quick Summary Today’s Announcement:No change to rates Overnight rate:0.25% Prime Rate:2.45% (also no change; seePrime Rate) Market Rate Forecast:No BoC hikes until at least 2023 BoC’s Headline Quote: “…The Bank is prepared to provide further monetary stimulus as needed.” BoC on the Economy: “The Bank expects economic slack to persist as the recovery in demand lags that of supply, creating...

“We’re in a Deep Hole:” BoC Governor

— The Mortgage Report : June 16 — Tiff on the Hot Seat: In his first news public hearing since being minted as BoC Governor, Tiff Macklem got pelted with questions from MPs. Among his notable statements: “The biggest risk to Canadians not being able to repay their mortgage is not having a job.” “…We’re in a deep hole and...

Historically Bad Housing Numbers

Mortgage Report – Weekend Edition Prices Tumble in April: The national average home price in Canada has plunged almost 10% in one month (April). That’s never happened before in CREA data going back to 1980. The next closest month-over-month drop was -7.6% in April 1989. The data was skewed partly by the GTA’s 11.8% nose-dive. Home Inventories Skyrocket: The total...

The “I Wish We Had Better News” Edition

Daily Mortgage Report – May 7 A Record 4 million: That’s how many jobs disappeared in April, predict economists surveyed by Bloomberg. That’s a stunning one-fifth of the labour force, and only a portion of those jobs will return soon. How many of these families own homes? A meaningful minority. But the bigger question is, how many will continue paying...