Some Major Banks have started increasing fixed rates, as the Government of Canada Bond yields push higher, past an unofficial 3.3% threshold.

The rest of the Banks are expected to follow suit over the coming days, with increases in the 0.05% to 0.10% range. Nothing major, but if you have a mortgage coming up for renewal, or if youre in the process of buying a home, it makes sense to reserve a rate before they increase.

Moreover, the likelihood of a Bank of Canada increase of 0.25% has increased to over 70% in December 2026, and is currently fully priced in for early 2027.

The elevated price of oil has been a factor in higher rates, but markets are increasingly pricing in stronger employment and GDP growth – both of which could stall if 50% tariffs go into effect. But currently markets believe there’s about a 25% chance Canada will see higher tariffs, and it’s more likely we’ll see lower tariffs over the weeks to come. This is currently being priced into improving economic strength in Canada, pushing mortgage rate forecasts higher, even though many Canadians are not feeling this on the ground level.

A sudden reversal in oil prices below $70 or a 50% tariff that goes into effect could slam the brakes on Canadian bond yields and the likelihood of a BoC increase in the coming months. However, this is not the base case, and we need to align expectations accordingly.

**Current Bank of Canada Outlook as of August 10 2026**