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Got a mortgage? Good news: Bank of Canada didn’t raise rates yesterday!

Blog Image, Your Best Mortgage is About More than Rate, Feb Mar 2018

Yesterday, Bank of Canada (BoC) Governor, Stephen Poloz, left rates unchanged. This kept the bank prime rate at 3.45%.

This also, indirectly, affects fixed mortgage rates. Great news for anyone with a mortgage. Go ahead, it’s okay to feel good about paying a low interest rate on what’s probably the biggest debt of your life!


For months we’ve heard economists forecasting 2-4 BoC rate hikes for 2018. So far, we’ve had one increase – in January. Should we be expecting three more increases? Only time will tell, since the BoC raises its rate when inflation rises above the target inflation rate… currently the range is between 1% and 3%, and sits at an acceptable 2.10%. Some believe inflation has increased temporarily, in part, due to increased minimum wage.

And, while it’s not really talked about in the mainstream media, one of the biggest factors contributing to inflation is the huge minimum wage increases this year in Ontario and BC.

This shouldn’t be a surprise. You can’t expect businesses to absorb higher payrolls and not pass along costs to the consumer. Visit any restaurant or grocery store and you’re sure to notice price increases. The cost of all goods and services has gone up. You have to wonder what net effect the wage hikes really pose for minimum wage employees, however, when the cost of living goes up as much or more than any wage hike?

Why I don’t think we’ll see three more BoC rate hikes this year… 

Every year, the BoC meets eight times on pre-set meeting dates. There are five meetings remaining in 2018. I just don’t believe the BoC will raise rates three more times this year.  There’s too much uncertainty with our economy… with the NAFTA free trade issues and President Trump. Average real estate prices are down around 10% this year.

We could potentially see two more rate hikes. Having said this, it’s no time to panic.  Canadians are very well prepared to handle this. Borrowers have been qualifying at higher rates for years. Rates are still well below the historical average. Enjoy the low rates!

Your best interest is my only interest. I reply to all questions and I welcome your comments. Like this article? Share with a friend.

Steve Garganis: 416-224-0114;

Steve Garganis View All

As an industry insider, Steve will share info that the BANKS don't want you to know. Steve has appeared on TV's Global Morning News, CBC's "Our Toronto" and The Real Life TV show. He's also been quoted in several newspapers such as the Globe and Mail, The Toronto Star, The Vancouver Sun, The Star Phoenix, etc.

4 thoughts on “Got a mortgage? Good news: Bank of Canada didn’t raise rates yesterday! Leave a comment

  1. Hi Steve, just about to sign up on a new mortgage.
    We’re being offered two good rates I believe but not sure which one is best.

    Variable rate starting now at prime minus .80
    Fixed 5Y rate at 3.29

    Can you tell me what you think would be best in the long run?

    Thanks- Philippe

    • Hi Philippe, this is an overdue reply, however, I have been advocating and promoting Variable rate and not locking into fixed rates.. as it turns out, this is still a good move. There have been some ridiculously low priced variable rate products for qualified applicants. Seeing Prime less 1.10%. stay tuned.. lot of bad economic news out there.. and bad news is good news for mortgage rates.. let me know if you want to chat.

  2. Hello,
    We’re about to renew our mortgage, cannot decide which term to select either 2, 3 or 5 years. Can you, according to forecasts, advise which would be the best

    Thank you!

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