Economic Update: What We’re Watching and What It Means for Your Mortgage
Right now, the economic outlook still feels a bit… wobbly. A lot of that is being driven by factors outside Canada’s control: shifting U.S. trade policy and broader geopolitical uncertainty.
The U.S. economy is expected to stay relatively resilient (consumer spending and major investment in tech/AI are big contributors), but Canada tends to feel the spillover when global confidence gets shaky.
At home, the picture is mixed. Canada’s growth momentum has softened, and the Bank of Canada has signalled that uncertainty remains a key risk. Unemployment has been elevated, sitting at 6.8% in December 2025, and that matters because when hiring slows and people feel less secure, big purchases and big financial decisions tend to slow down too.
The good news is inflation is expected to stay close to the Bank of Canada’s 2% target, which helps keep a lid on runaway borrowing costs. But “stable inflation” doesn’t automatically mean rates will drop quickly — it just means the Bank has room to be patient while it watches what happens next.
What does this mean for the average Canadian (and British Columbian)?
In plain terms:
If you’re renewing in 2026: the biggest advantage you can have is still time. The earlier you start looking at options, the less likely you are to end up making a rushed decision based on a lender’s first offer.
If you’re buying in 2026: the market can feel uncertain, but uncertainty doesn’t have to be a blocker. It just means planning matters more — budget comfort, payment flexibility, and a mortgage structure that fits your real life.
If you’re in a variable rate: the conversation right now is less about “predicting” the next move and more about whether you’re comfortable with payment fluctuations and how much buffer you have in your monthly budget.
If you’re feeling stuck: this is exactly when strategy helps. You don’t need to have everything figured out — you just need a clear view of your options and timelines.
Key dates to know
Next Bank of Canada rate announcement: March 18, 2026
Next Monetary Policy Report: April 29, 2026
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Canada's growth has softened, unemployment sits at 6.8%, and global uncertainty is creating economic drag — but inflation remains near target. If you're renewing or buying in 2026, the advantage isn't prediction. It's preparation.