Mortgage rates could rise upon a sudden end to the tariffs, and you can always get a lower rate if they drop by the time you renew.PM Images/iStockPhoto / Getty Images
Lenders will be watching closely as an unpredictable trade war initiated by U.S. President Donald Trump continues to unfold and affect mortgage rates in Canada.
The Canada five-year bond yield – a major indicator of where fixed mortgage rates are set to go – dropped sharply during the lead-up and implementation of widespread 25-per-cent tariffs on Canadian imports. It has since regained some ground but analysts expect more drops in long-term mortgage rates in the coming weeks. Mr. Trump’s Thursday announcement of another one-month reprieve for tariffs only adds uncertainty to the situation, especially with the potential for the measures to return again.
A prolonged trade war could also bring down variable mortgage rates. But we’ll have a better expectation of where those rates are going after the Bank of Canada’s rate announcement next week, when Governor Tiff Macklem may give a sense of how the central bank will deal with the economic blow and potential inflation that result from tariffs. Markets have currently priced in another three interest-rate drops in 2025.
In this rocky economic environment, mortgage brokers are clear about one thing for people who are nearing renewal: Lock in the rate you have now. Rates could rise upon a sudden end to the tariffs, and you can always get a lower rate if they drop by the time you renew.
Mortgage rates sourced by Ratehub.ca. For a comprehensive list of today’s mortgage rates for each term/type, visit: https://www.ratehub.ca/best-mortgage-rates
Ratehub.ca is a mortgage rate comparison marketplace and mortgage brokerage. They help 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 March 6.
