Canadian Mortgage Trends ~ October 1st, 2026
Rising bond yields are pushing fixed rates higher, but experts are divided on whether Bank of Canada hikes will erode the savings offered by variable mortgages.
Fixed mortgage rates are climbing again after another jump in Canada’s 5-year government bond yield, extending an upward trend that began around the outbreak of the war in Iran in late February.
The yield has risen from roughly 2.6% before the war to above 3.6%, topping 3.7% on Monday. CIBC and TD raised select 3- and 5-year fixed mortgage rates on Tuesday, joining other major banks and lenders that have increased rates in recent weeks.
Why bond yields are rising
Bruno Valko, VP, National Sales, RMG MortgagesBruno Valko, VP, National Sales, RMG Mortgages
Seven months into the war, elevated oil and commodity prices are fuelling inflation concerns, while several major central banks have raised interest rates.
While the Bank of Canada has held its policy rate steady, rising global bond yields, particularly in the United States, are putting upward pressure on Canadian yields.
“Australia increased, Europe’s increased twice, Japan has increased, the United States we saw has increased,” says Bruno Valko, vice-president of national sales at RMG Mortgages. “Canada is the outlier here so far, and with all these other countries increasing, there’s definitely potential upward pressure.”
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