Despite a cooling bond market and signals of potential interest rate hikes, Toronto-area borrowers continue to lean heavily into variable-rate mortgages. According to mortgage strategist Robert McLister, recent economic data—including a dip in unemployment to 6.4 per cent and strong job growth—has bolstered the case for fixed-rate stability. While five-year fixed rates saw a minor five-basis-point uptick to 3.92 per cent for insured borrowers, the allure of the variable rate remains strong for many. Market watchers are now eyeing the potential impact of looming U.S. tariffs, which could introduce fresh volatility into Canadian yields. For those caught between two worlds, hybrid mortgages offer a middle-ground strategy. As the Bank of Canada navigates shifting GDP projections and core inflation, the disconnect between bond market caution and borrower sentiment remains a defining feature of the current landscape. Read the full analysis at the Financial Post to see how these trends might impact your financing strategy.
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