Bank of Canada signals rates could rise even in a slowdown
- Nor Yu
- Mar 5
- 1 min read
Most people think a slowing economy = lower interest rates. ☝️
The Bank of Canada just told us that's not guaranteed anymore.
When the economy slows down because of tariffs and trade wars — not because people stopped spending — you get a weird situation.
Prices stay high. Growth slows down. At the same time.
If the BoC cuts rates in that environment, they risk making inflation worse. So they're stuck. They can't just hit the gas pedal like they normally would.
What does that mean for you?
→ Variable rate holders: don't count on more relief coming
→ Renewing in the next 12 months? Locking in may make more sense than waiting
→ Thinking about breaking your mortgage to refinance? The math is tighter than you think
Some of Canada's biggest banks (Scotiabank, National Bank) are now forecasting a rate HIKE of up to 0.50% by end of 2026.
Not a cut. A hike.
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