The fixed mortgage rate forecast is beginning to sound like a broken record as we keep repeating the same things over and over again. 5 year fixed mortgage rates are tied directly to the 5 year government of Canada benchmark bond yield which doesn’t look like it’ll be making any significant changes in the months ahead. This 5 year benchmark bond yield has mostly been bouncing between 1.2% to 1.6% for the past year and was last recorded at 1.37% on Oct 5th. Current 5 year fixed mortgage rates enjoy a spread of 1.72% over the benchmark bond so there’s no immediate pressure for a rate change.
Global risks haven’t subsided over the fall thus far and Canada remains a financial safe haven. So, once again I have to report that the short and medium term outlook for the 5 year fixed mortgage rate is steady as she goes. There will be anomalies and competitive pressures that could drive 0.25% swings in the mortgage rate but don’t expect any significant changes.