Why Canadian Fixed Mortgage Rates Are Rising Again – And What It Means For You
Fixed Mortgage Rates Climb Back Above 4%
After briefly dipping below 4%, fixed mortgage rates in Canada have risen again, with most big banks now posting rates above that threshold. This change comes as a result of rising bond yields, especially those in the U.S., which directly influence Canada’s 5-year bond yields and therefore fixed mortgage rates pricing.
What’s Behind The Rate Hike?
Canadian mortgage rates are often driven more by international market forces than domestic events. The 5-year fixed mortgage rate, for example, is tied closely to the Canadian 5-year government bond, which follows the U.S. 10-year Treasury Yield. Recently, that U.S. yield has surged back above 4.5%, pushing Canadian bond yields – and fixed mortgage rates – upward.
Banks like RBC, TD, and CIBC have already responded by raising their 5-year fixed rates. Meanwhile, Scotiabank bucked the trend slightly, dropping some shorter-term promotional rates.
What Should Mortgage Holders Do?
This volatility highlights the unpredictability of interest rates. Experts suggest that risk-averse homeowners may benefit from locking into a 5-year fixed mortgage rate for peace of mind. On the other hand, some predict that variable rates could fall later this year, making them an option for those who can handle short-term rate fluctuations.
Ask The Experts At Client First Mortgage Solutions
Whether you are unsure about locking in or want to prepare for falling rates, Client First Mortgage Solutions is here to help. Our experienced team will walk you through the best mortgage options based on your needs and market conditions. Contact Us today!
Original Article – Canadian Mortgage Trends – May 14, 2025
