If you've talked to me this week, you've probably heard me mention that rates are moving again — and not in the direction anyone renewing or buying wants to see.
This isn't one lender quietly repricing on its own. Canada's 5-year government bond yield — the number that drives most fixed mortgage rates — jumped roughly 25 basis points in a single week. Major banks have raised their posted rates 10-20 basis points in response, and some lenders have moved 20 basis points or more as they pull back the discretionary discounts they'd been offering.
What's actually driving it
The short version: renewed conflict between the U.S. and Iran has disrupted oil shipments through the Strait of Hormuz, and that kind of energy-market shock tends to ripple straight into bond yields — and from there, into the fixed rates lenders can offer.
Where this goes next is genuinely hard to call. Some analysts expect yields to keep grinding higher for a while yet; the bond market is even pricing in the possibility of further Bank of Canada moves over the next 12 months. But this is a geopolitical story, not a purely economic one — a de-escalation could ease the pressure just as quickly as it appeared. Anyone telling you with certainty where rates go from here is guessing.
What I'm telling clients right now
You don't need to correctly predict the market to protect yourself from it. A pre-approval locks in today's rate for 90-120 days, with no obligation to use it if rates happen to come back down before you close. It costs you nothing to hold, and it could save you real money if this upward trend continues.
If your renewal or closing is coming up in the next few months, this is a good week to have that conversation rather than wait and see where things land.
