October 07, 2013 12:00 ET

Soaring Safe Haven Bonds Lead To Lower October Fixed Mortgage Rates

Investors Flock To Canadian Bonds Amid Growing U.S. And Global Debt Fears

TORONTO, ONTARIO--(Marketwired - Oct. 7, 2013) - Government of Canada bonds are once again the go-to safe haven for investors seeking stability amid increasing debt fears in the U.S. and worldwide. This will lead to a slight reversal of last month's climbing fixed mortgage offerings, as lenders adjust their mortgage rates in tandem with yields. Variable mortgage rates will uphold the status quo, however, as Canadian economic growth factors remain below par, failing to prompt any change to monetary policy or interest rates in the near future.

Fixed Mortgage Rates: Down: Government of Canada bond yields have moderated slightly over the short term as uncertainty lingers over the American debt ceiling, driving investors to safe haven investments. This will prompt lenders to conservatively lower their fixed mortgage rate offerings.

Variable Mortgage Rates: Unchanged: Economic growth engines such as exports and business investment continue to stall, failing to fill the gap left by diminished consumer spending. The Bank of Canada has stated that a cut to the previous growth forecast may be warranted for 2013. Current interest rates will not be altered until these factors reach their growth benchmarks in the new year, and there will be no change announced in the next rate announcement on October 23.

This month's panel members:

  • Ron Butler, Mortgage Broker, Verico Butler Mortgage
  • Dan Eisner, MBA. AMP. President, True North Mortgage
  • Dr. Ian Lee, Program Director, Sprott School of Business, Carleton University
  • Kelvin Mangaroo, President, RateSupermarket.ca

Click here to read the full Mortgage Rate Outlook Panel.

About RateSupermarket.ca (www.ratesupermarket.ca)

Over 3 million Canadians have found their best rate for personal finance products on RateSupermarket.ca. Launched in 2008, RateSupermarket.ca is Canada's most comprehensive rate comparison site, offering visitors transparent access to the best mortgage rates as well as credit cards, bank accounts, insurance quotes and GIC rates.

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