Oil has climbed back over the $100 threshold that the Bank of Canada called out in last month’s Monetary Policy Report.
The longer that crude stays in triple digits, the greater the chance mortgage rates and prime rate will be packing for a trip north.
And yet, somewhere around four in 10 borrowers have been taking variable rates , apparently unconvinced that oil-driven inflation has legs.
By historical standards, the best variable rates are still underwhelming, at least if you’re not default insured.
Citadel Mortgage is leading the advertised uninsured market with a prime minus 0.76 per cent (3.69 per cent) offer.
Alternatively, floating-rate borrowers can save about 34 basis points on the rate if they buy default insurance.
For those who think this latest inflation spike is short-lived, True North Mortgage now offers two-year insured rates at just 3.99 per cent, or 4.49 per cent for a one-year. Both of those lead all national lenders
At the moment, however, three-year fixed rates continue to be the crowd favourite. The leaders there are hovering around four per cent, plus or minus.
If you’re out there fixed-rate shopping, the clock may not be on your side. Lock in a rate hold early because if Canada’s five-year government bond yield closes above 3.33 per cent or so, fixed rates could pop again.
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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