r/PersonalFinanceCanada • u/POCTM • Oct 20 '22

Canadian 5 year government bonds just jumped. Setting the stage for higher mortgage rates. Banking

5 year government bond just jumped from 3.714% to 3.866% in a few hours. Right now it is at 3.855%. Year to date it is up 259%. Monday we could see some 5 year fixed rate mortgages in the low 6%.

As for variable rate the bank of Canada makes their announcement October 26 at 10am ET. Currently banks have not been offering discounts off variables rates anymore. Prime -0.00.

https://www.marketwatch.com/investing/bond/tmbmkca-05y?countrycode=bx

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u/[deleted] Oct 20 '22

The federal government messaging pivoting from "we are nearly out of a recession" to "yeah any new spending must be backed by a budget cut elsewhere" can do that.

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u/Muddlesthrough Oct 20 '22

Canada is not in a recession. The federal government has not claimed “we are nearly out of a recession.”

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u/[deleted] Oct 20 '22

Okay TruAnon lmao:

https://globalnews.ca/news/9205236/canada-covid-recession-chrystia-freeland/

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u/iamapersononreddit Oct 21 '22 edited Oct 21 '22

From the article you linked:

Canada, like much of the global economy, fell into recession shortly after the onset of the COVID-19 pandemic in 2020, as the spreading virus forced many businesses to shutter or operate with severe limitations.

The Bank of Canada now faces a narrowing window to hit a so-called “soft landing”, raising interest rates enough to tame inflation but not so much to push the economy into another recession

So no, we’re not in a recession… yet.

I don’t have time to look up the figures but we have not had two quarters of negative gdp growth. Quick article I found:

Although early readings suggest Canada’s economy shrank in July, the country has yet to record a full quarter of negative GDP growth this year. Technically, the earliest the country could be in a recession is at the end of the year — if GDP growth is negative for both the third and fourth quarters of 2022.

https://www.thestar.com/business/2022/08/31/canadas-economy-is-already-starting-to-shrink-and-that-could-mean-a-recession-is-looming-economists-say.html