As we approach the March 12 Bank of Canada (BoC) meeting, market expectations are shifting, with a 72% chance of a 25 bps rate cut. Here's what you need to know:
📉 Rate Trends & Expectations
- Prime Rate: 5.20%
- BoC Policy Rate: 3.00%
- Next BoC Meeting: March 12, 2025
- Market Expectation: 72% chance of a 0.25% rate cut
🔻 Bond Yields & Fixed Rates
The 5-year bond yield has declined by 0.10% this week, currently sitting at 2.57%. If this downward trend continues, we may see fixed mortgage rates adjust lower in the coming weeks. However, it’s important to note that fixed-rate Interest Rate Differential (IRD) may increase, making it more costly to break a fixed-rate mortgage early.
📉 Rate Trends & Expectations
- Prime Rate: 5.20%
- BoC Policy Rate: 3.00%
- Next BoC Meeting: March 12, 2025
- Market Expectation: 72% chance of a 0.25% rate cut
Yield Changes:
- 5-Year Bond Yield: 2.57% (-0.10% from last week)
- Insured Yield Spread: 1.52%
- Uninsured Yield Spread: 2.02%
🏡 Current Mortgage Rates
Insured Rates (High Ratio – Less than 20% Down)
- 5-Year Variable: 4.25% ($5.40 per $1K) – Qualifying Rate: 6.25%
- 5-Year Fixed: 4.09% ($5.31 per $1K) – Qualifying Rate: 6.09%
- 3-Year Fixed: 4.14% ($5.34 per $1K) – Qualifying Rate: 6.14%
Uninsured Rates (Conventional – $1.5M+ Purchase Price)
- 5-Year Variable: 4.60% ($5.10 per $1K) – Qualifying Rate: 6.60%
- 5-Year Fixed: 4.59% ($5.09 per $1K) – Qualifying Rate: 6.59%
- 3-Year Fixed: 4.59% ($5.09 per $1K) – Qualifying Rate: 6.59%
- HELOC: 5.70% ($4.75 per $1K) – Qualifying Rate: 7.70%
🔍 What This Means for You
✅ Fixed rates could decline in the near future if bond yields continue to trend lower. If you're considering locking in a fixed rate, it may be worth monitoring the market over the next few weeks.
⚠️ Variable rates remain steady but could decrease if the BoC proceeds with a rate cut next week.
💡 Penalty costs may increase for fixed-rate mortgages due to declining bond yields. If you’re unsure whether a fixed or variable mortgage is right for you, let’s discuss your options.
📅 Upcoming BoC Meetings: Mar 12 | Apr 16 | Jun 4 | Jul 30 | Sep 17 | Oct 29 | Dec 10
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📚 Recent Blog Articles & Mortgage Planning FAQs
Stay informed with our latest blog articles and mortgage insights:
Blog Articles:
- 🏡 A Simple Guide to Fixed, Variable, and Adjustable-Rate Mortgages
- 🔨 Planning a Spring Renovation? Here Are Your Financing Options
If you have any questions about these updates or want to discuss your mortgage strategy, feel free to reach out!
Best,
Matt Parker