When the Bank of Canada holds its rate, many people assume mortgage rates will stay put. Then fixed rates move anyway. Here's why.
Two different engines
Variable rates follow lenders' prime rate, which moves with the Bank of Canada's overnight rate. Fixed rates are driven mainly by Government of Canada bond yields — especially the 5-year bond.
What moves bond yields?
Inflation expectations, economic data, global markets and U.S. bond yields. When investors expect higher inflation or stronger growth, yields rise — and lenders raise fixed rates to match, often within days.
What it means for you
Fixed rates can rise or fall between Bank of Canada announcements. If you're buying or renewing, a rate hold (often 90–120 days) can protect you while you shop.
Want to know what today's market means for your purchase or renewal in Ottawa or across Ontario? Let's talk.