Bank of Canada Interest Rate Update - April 2024

The Bank of Canada (BoC) met on April 10th, and made the decision to leave rates unchanged once again. It has been quite the roller coaster ride of inflationary news over these past few weeks, with market expectations changing for exactly when the BoC will drop interest rates, and by how much. The BoC has reinforced that it is still expecting our inflation targets to reach 2.5% by the end of this year and to reach our 2% target by the end of 2025, although we are likely in for a bumpy ride getting there.

To read the official April 10th announcement, please click HERE

Since this latest wave of economic data, the market is now only pricing in a 50% probability of a rate cut in June, and a 100% probability of a rate cut by July, with a total of 0.75% in cuts expected this year. However, many economists still feel that there is a lot of data pointing to a much weaker economy than the BoC is drawing attention to, and as such we may see a higher percentage of rate cuts. Only time will tell, no one holds that darn crystal ball.

My top recommendation continues to be that we must ensure your financial house is in order so that you are better able to weather this storm, and I am here to help you through this. Please do not wait to reach out to me until it’s too late. If you have any high interest debt or are struggling with your payments, I am here to help. And if you have a mortgage that is coming up for renewal in 2024 or 2025, please reach out to me so that we can work together on a plan to ensure you are prepared.

What does this rate announcement mean for you?

No changes

If you are in a "fixed payment - variable interest" product...

And your payments have not yet changed, then you have likely hit or passed your "Trigger Rate", and you may be nearing your "Trigger Point". It is important that you understand the consequences of this, so please reach out to me so that I can explain your specific situation and my recommendations for what to do.

Should I lock-in my variable rate now?

If locking-in to a fixed rate is something you are considering, let's talk. You may want to consider a short term fixed rate, which can offer you the fixed comfort today while still being able to renew at a time when rates are (hopefully) lower. 

I am personally going to continue to ride this out in my variable rate mortgages, as the current lock-in rates are too high for it to make sense for me. However, my budget can support the risk of staying variable, and the lock-in rates today don't work for my situation. I do feel that there may be a time in the next 12-18 months where locking-in could make sense, and I will continue to monitor things and keep you informed. However, if locking-in now feels best for you, please let me know and I can support you through it!

Some of our lowest fixed rate options available today:

• 1 year fixed @ 6.79%*

• 2 year fixed @ 5.64%*

• 3 year fixed @ 5.09%*

• 4 year fixed @ 5.09%*

• 5 year fixed @ 4.84%*

*Conditions apply

I want to lock-in to a fixed rate, what do I do now?

Contact your lender directly and ask them what rate they will offer you to lock-in. Request all terms available to you, including 2 or 3 year rates if possible. Once you have that information please send it to me and I will help you with a strategy. 

Our team is here to support you every step of the way! 

I hope that you have an amazing week!