The Bank of Canada hit pause — but the economy didn’t. Mortgage Minute for June 6, 2025

by | Mortgage Minute

From a record trade deficit to rising unemployment, the cracks are showing. And yet, fixed mortgage rates are still rising. For buyers, renewers, or refinancers, this is a high-stakes moment — one that rewards preparation over prediction.

Here’s your mortgage minute for this week:

The Bank of Canada held rates at 2.75%, shifting to a data-dependent stance as economic signals flash mixed. Canada’s merchandise trade deficit ballooned to a record $7.1 billion in April, with auto exports plunging 23% amid new U.S. tariffs. CIBC and BMO now expect the Bank to cut rates at both the July and September meetings.

Meanwhile, the unemployment rate rose to 7% in May — the highest since 2016 (excluding pandemic years). Manufacturing, services, and public sector jobs fell, and wage growth held steady at 3.4%. Economists say this softening supports rate cuts, even if the timeline isn’t locked in.

But fixed mortgage rates are still rising. RBC’s 5-year uninsured fixed hit 4.49%, with bond volatility keeping lenders cautious. And delinquencies are rising too: Ontario’s 90+ day mortgage delinquency rate rose 71.5% YoY.

In the housing market, May sales were down YoY: GTA -13%, Calgary -17%, Vancouver -18.5%. But listings are up — offering buyers leverage we haven’t seen in years.

My take?
This is a window for proactive planning. If your mortgage renews in the next 6–12 months, or you’re shopping this summer, let’s talk options — before mortgage rates or market conditions shift again.

 

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