The question now being asked by anyone keeping an eye on Canadian mortgage rates is: If our economic momentum is accelerating and our output gap closes more quickly than forecast, will our mortgage rates rise more quickly than expected? Today's post offers my take.

Last week was a relatively quiet one for the factors that affect Canadian mortgage rates. Our federal budget was dubbed a “non-budget” because its content was more benign than many had feared, with our capital-gains and principal-residence tax exemptions left intact, at least for now.

Last week the U.S. Federal Reserve raised its policy rate by 0.25%, as expected. In today’s post, we’ll take a look at the highlights from the Fed’s latest statement (in italics) with my comments added, and then discuss the implications for both Canadian fixed and variable mortgage rates.

When the U.S. Federal Reserve raises its policy rate on Wednesday, as is widely expected, will U.S. bond yields rise? And will their Canadian equivalents and our mortgage rates get taken along for the ride? Today’s post offer my take.

The gap between our fixed and variable mortgage rates has widened of late, and my read of the tea leaves says that it will continue to do so in the near future. Today’s post explains why.

There is plenty of action south of the 49th parallel and to that end, here are five recent observations about U.S. events that are unfolding that will weave their way into Canada's mortgage-rate narrative over time.

Last week was an interesting one for five-year Government of Canada (GoC) bond yields, which our five-year fixed mortgage rates are priced on. We started the week with GoC bond yields falling in sympathy with their U.S. counterparts as investors re-evaluated their bets that the Trump presidency would lead to higher growth and inflation. Thus far, President Trump has focused on his anti-immigration and protectionist trade policies and not on his promises for fiscal stimulus and tax cuts.

The Fed’s latest commentary matters to anyone keeping an eye on Canadian fixed mortgage rates because our bond yields have moved in virtual lock step with their U.S. equivalents since the start of the Great Recession. While our economies now appear to be progressing along very different trajectories, for as long as the current bond yield correlations hold, if U.S. interest rates rise, Canadian rates will get taken along for the ride. Here are five highlights from the Fed’s latest statement, with my comments added.