Financial markets expect one or two more rate cuts between now and the end of 2026.Paige Taylor White/The Canadian Press
The Bank of Canada has finally delivered another interest-rate cut – its first since March – and variable-rate mortgages are looking a little more attractive as a result.
The lowest available five-year variable-rate mortgages are roughly a quarter-point cheaper than the lowest available five-year fixed-rate loan.
Moreover, financial markets currently expect one or two more rate cuts between now and the end of 2026. Markets are also currently pricing in a 43-per-cent chance that the central bank will lower its benchmark rate again when it convenes on Oct. 29.
Meanwhile, fixed rates remained steady this week. Such mortgages are affected by bond yields rather than the Bank of Canada’s policy rate.
Ron Butler, the founder of Butler Mortgage in Toronto, said fixed rates dropped slightly earlier this month when the Canada five-year bond yield dropped to 2.7 per cent.
Recent drops in bond yields have been attributed to higher market expectations of lower interest rates in the future.
Mortgage rates are sourced by Ratehub.ca. For a comprehensive list of today’s mortgage rates for each term/type, visit ratehub.ca/best-mortgage-rates.
Ratehub.ca is a mortgage-rate comparison marketplace and mortgage brokerage. It helps millions of Canadians compare and obtain the best mortgage rates, credit cards, insurance, deposits and loan products.
Rates shown are the lowest available for each term/type and category (insured versus uninsured) as of market close on Sept. 18.
