Bank of Canada Decrease’s Policy Rate to 4.75%

Bank of Canada’s announcement today reduces the policy rate to 4.75%, down from 5% it has held since July 2023. This change aims to address economic pressures Canadians have been facing due to rising costs and high mortgage payments.

This reduction comes at a critical time. Many Canadians have been struggling with rising costs and higher mortgage payments and today’s announcement will provide a small amount of relief, but more importantly – HOPE.

Today’s announcement will lower monthly payment by $15 per every $100k borrowed, it’s expected that this is just the beginning, and we’ll see continued rate relief in the months and years ahead.

Bond Yields Dropping

In response to the Bank of Canada’s rate reduction, we are seeing the Bond Yields decreasing. Generally, this signifies fixed-rate specials are coming soon!

If you currently have a fixed-rate mortgage in the HIGH 5% – 6% range you may be able to refinance your mortgage early and save some money without incurring a massive penalty.

Lender’s use the posted rates on their website to determine the penalty for breaking a mortgage mid-term. When the posted rates decrease, your penalty increases.

Oftentimes, there is a short opportunity to capitalize on lower-rates before posted rates decrease.

As always, I am here to help you navigate these changes. Reach out if you need assistance or have questions

5-year bond yield June 5, 2024