How the US Fed’s Latest Decision Will Impact Canadian Mortgage Rates

The US Federal Reserve has maintained its policy rate, citing progress towards its 2% inflation target. The Fed now anticipates only one rate cut in 2024, a decrease from the previously projected three cuts. Fed Chair Powell stressed the importance of robust data to support sustainable inflation. Meanwhile, the Bank of Canada is expected to cut rates twice more this year, diverging from the US Fed's monetary policy. Canadian fixed mortgage rates are affected by US bond yields, which have recently diverged from GoC bond yields. Variable-rate discounts remain steady, with further rate relief expected in July.