Oil is still steering the near-term direction of Canadian mortgage rates due to its inflation threat .
For now, markets are betting the Iranians will formally sign onto the United States peace proposal. The burst of optimism has knocked WTI crude down more than seven per cent since Monday.
That, combined with a 50-basis-point decline in long-term U.S. inflation expectations — which fell to 3.4 per cent according to the University of Michigan — helped push Canada’s five-year government yield to a seven-week low on Friday.
If we stay at or below these levels, some modest fixed-rate relief could be incoming.
Meanwhile, about half of borrowers are still biting on variables , inspired by the fact that floating rates hold a roughly 55 to 60 basis point edge over fixed ones.
Online brokers like Citadel are still advertising fixed rates as low as 3.92 per cent, while online brokers like Butler Mortgage’s are as cheap as 3.30 per cent on the variable side.
Those offers apply to default insured mortgages , however, which doesn’t help if you need to refinance or buy a home over $1.5 million. For uninsured mortgages like that, you’ll generally find the lowest advertised fixed and variable deals at regional players like Ratebuzz (if you’re in Ontario) or credit unions.
Robert McLister is a mortgage strategist, interest rate analyst and editor of MortgageLogic.news. You can follow him on X at @RobMcLister.
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