TORONTO – The Bank of Canada’s decision to lower interest rates for the first time since March will have a direct effect on variable mortgages, and shifts the equation on whether to go with a fixed or variable rate.

Penelope Graham, mortgage expert at Ratehub.ca, says the growing narrative that rates will continue to move lower means variable rates can be an attractive option for price-sensitive borrowers.

She says, however, that the decision depends on the borrowers’ risk tolerance, especially as the trade picture remains unpredictable and could put upward pressure on inflation.

Graham says fixed rates are starting to reflect the downward pressure on bond yields, but for now the lowest variable rate should work out to 3.70 per cent while the lowest fixed rate is 3.94 per cent.

Accordi

See Full Page