Mortgage rates on the rise
Mortgage rates are on the rise again as inflation jitters south of the border have raised yields in the bond market, where banks finance their lending.
Canada's big banks have raised short- and long-term rates by a quarter to three-tenths of a percentage point.
The new rates are:
- Six month convertible 7.55 per cent, up .25 per cent
- Six month open 8.00 per cent, up .25 per cent
- One year open 8.20 per cent, up .25 per cent
- One year closed 7.60 per cent, up .25 per cent
- Two year closed 8.10 per cent, up .25 per cent
- Three year closed 8.30 per cent, up .25 per cent
- Four year closed 8.45 per cent, up .30 per cent
- Five year closed 8.55 per cent, up .30 per cent
- Seven year closed 8.80 per cent, up .30 per cent Ten year closed 9.10 per cent, up .30 per cent
On a five-year mortgage, the new rates will add $20 a month to payments on a $100,000 mortgage.
The changes are effective Jan. 8.
Bond yields have been heading up in recent days as investors worry about growing inflationary pressures in the U.S. economy.
A U.S. Labor Department report Friday showed a surge in wages, further fuelling market speculation that the U.S. Federal Reserve will raise rates when it meets Feb. 1 and 2.
If the Fed raises rates as expected, the Bank of Canada is expected to follow suit.