Lowest fixed and variable mortgage rates in Canada for July 13 2023

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Fixed and variable rates could soon start going in opposite directions

Following encouraging inflation news north and south of the border, Canada’s five-year bond yield retreated from 4 per cent this week. It’s now down a whopping 30 basis points since its 16-year high on Monday.

The Bank of Canada’s magic rate wand strikes again: Five mortgage implications

That’s good news for fixed-rate mortgage shoppers. If this keeps up, we could see fixed rates edge down slightly by the end of next week.

Variable rates, unfortunately, went the wrong way. Up. The lowest nationally advertised variable rate is now 25 basis points higher than last week — that is, 5.9 per cent if default-insured and 6.4 per cent if uninsured.

With the Bank of Canada now expecting it to take until mid-2025 to get inflation back to its target of 3 per cent, more mortgage consumers may shift to two- and three-year fixed rates, versus one-year and variable rates.

As for the Bank of Canada meeting on Sept. 6, bond market pricing implies there’s now a two-in-three chance it will keep rates as-is. Further deterioration in the jobs market, if we get it in time, could push that near 100 per cent.

Rates are as of July 13, 2023, from providers that advertise rates online and lend in at least nine provinces. Insured rates apply to those buying with less than a 20 per cent down payment, or those switching a pre-existing insured mortgage to a new lender. Uninsured rates apply to refinances and purchases over $1-million and may include applicable lender rate premiums. For providers whose rates vary by province, their highest rate is shown.

Robert McLister is an interest rate analyst, mortgage strategist and editor of MortgageLogic.news. You can follow him on Twitter at @RobMcLister.

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