Ottawa Rate Watch: What the latest BoC hold means for variable vs fixed
Updated Feb 19 · 3 min read · Ottawa, Gatineau · EN/FR
Policy Rate
2.75 %−25 bps
5-Yr Bond
2.68 %−12 bps
CPI
2.3 %On target
Signal
What happened
The Bank of Canada held the overnight rate at 2.75 %. No surprise. The labour market is softening but core CPI remains sticky above two percent.
Impact
What it means for borrowers
Five year fixed pricing has barely budged. Swap rates already price two more cuts by year end, so discounted fixed rates sit around 3.89 %. Variable moved immediately: prime dropped to 4.95 %.
Comparison
Variable vs fixed
If you plan to hold for five years, fixed at 3.89 % gives certainty. If the BoC delivers one more cut, variable at prime minus 0.85 % beats fixed within eighteen months. Break even: ~40 bps of easing.
Key Takeaways
- BoC held at 2.75 %. Market expects two more cuts by December.
- Fixed rates near 3.89 %; variable available at prime minus 0.85 %.
- Break even: ~40 bps of further easing favours variable.
Key metrics
Live indicators for the markets you cover.
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