Rising bond yields have put upward pressure on fixed mortgage rates for the past few weeks and RBC was this first to flinch. As of today RBC increased its 1 year mortgage rate by .14% to 3.14%; it’s 2 year mortgage rate by .1% to 3.14%; it’s 3 year mortgage rate by .1% to 3.65%; it’s 4 year mortgage rate by 0.1% to 3.09%; and most notably it’s 5 year fixed mortgage rate by .2% to 3.29%.
This mortgage rate increases have largely been anticipated by market watchers noting that the banks could only withstand compressed margins for so long. The 5 year Government of Canada Benchmark bond yield hit 1.56% on Friday, it’s highest level of the year and .2% higher than the average for the same period. The RBC increase of .2% matches the bond yield increase and relieves any upward pressure on rates for now.