Rate cuts to smooth over the 'mortgage renewal cliff' awaiting pandemic homebuyers
Many homeowners who will be renewing their five-year mortgages for the first time next year may be worried about a steep increase in their monthly payments. But faster and larger than expected interest-rate declines promise to reduce what analysts had dubbed the "mortgage renewal cliff" into something more akin to a hill.
Growing concern about the health of the Canadian economy is raising the odds of a bigger-than-usual interest-rate cut by the Bank of Canada in October, according to investors and economists. With several more reductions expected this year and in 2025, some forecasters see the central bank’s trend-setting rate falling to 3 per cent or even lower by the next summer, down from its current level of 4.25 per cent.
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