BMO says we have reached mortgage rates peak or are close to it
According to BMO senior economist Robert Kavcic, mortgage rates will soon begin to fall in Canada.
“If our forecasts are right, Canada’s mortgage rates are now at or near their peak. The central bank is expected to raise its key lending rate by 0.25% one more time next week, probably marking the end of its increasing cycle. At the same time, 5-year yields went down to approximately 2.8% which is lower than in December. Today’s level is more consistent with 5-year fixed rates in the 4.5-5% range, while it still takes some time to show the full influence on the entire system.
It’s still a significant shock compared to available rates at around 1.5% we’ve seen just a year ago. However, the stop in growth should help in terms of the margin, and offer certain confidence that the worst of the rate hikes is already over.”