Interest rates are back in the spotlight, and both the Bank of Canada and the US Federal Reserve are signalling that we may be near the end of the 2025 rate-cut cycle. For Alberta buyers, this affects mortgage rates, affordability, and how you should plan your next move. Here is a clear update on what is happening and how working with me, Josh Tagg, can help you make the best decision.

Central Banks Are Becoming More Cautious

The Bank of Canada cut its policy rate on October 29, but it also said the current rate is likely at the right level unless new economic data changes the outlook. Because of that, markets now see less than a 10 percent chance of another rate cut on December 10.

The US Federal Reserve is sending the same message. Even though it cut rates on October 29, the Fed is warning that more cuts are not guaranteed. A recent US government shutdown delayed key economic data, making the Fed more cautious than usual. “But Josh, why should we care what the US is doing?” Canada should care—a lot—when the US Federal Reserve cuts its policy rate. Even though the Fed doesn’t set Canadian interest rates, its decisions strongly influence our economy and, in turn, the Bank of Canada’s choices.

The bottom line is that both central banks are tapping the brakes and waiting for clearer information.

What This Means for Mortgage Rates in Alberta

Government of Canada bond yields increased slightly. Since fixed mortgage rates follow bond yields, this has kept fixed rates from moving lower.

Variable-rate discounts did not change. While another cut in 2025 is unlikely, I still expect the Bank of Canada to reduce its rate by at least another 0.25 percent before this cycle ends.

This month’s inflation reading is especially important. It is the last full inflation report before the Bank of Canada’s December 10 announcement. Another report comes on December 15, but the decision will already be made by then. The report showed mixed but mostly positive news. Headline inflation dropped to 2.2 percent, and two of the Bank of Canada’s important core measures also fell. However, one core measure rose to 2.9 percent, which adds pressure on the Bank to hold rates steady for now.

With mixed data, the most likely result is a rate hold in December.

Fixed vs Variable: What I Recommend Right Now

Three- and five-year fixed rates remain close to their long-term average. If the rates stay similar, the five-year fixed still offers slightly better value and stability.

Variable rates may end up being the lowest-cost option over the full mortgage term, but only for borrowers who are comfortable with short-term uncertainty. Variable rates can move up and down, so make sure your budget can handle either scenario.

If you are unsure which option fits you best, I can run the numbers with you and help compare your choices. Send me a message to get started.

What Canada’s Big Banks Are Predicting

Not all banks agree on what happens next:

• Scotiabank thinks the Bank of Canada is done cutting and expects two rate hikes in late 2026
• TD, RBC, and CIBC expect rates to stay at 2.25 percent through 2026
• BMO and National Bank still expect one more 0.25 percent cut

These differences show how uncertain the outlook is. That is why having an experienced mortgage broker like me in your corner matters more than ever.

Why Alberta Buyers Should Work With a Mortgage Broker Now

Markets are moving, inflation is shifting, and expert forecasts are divided. Getting clear, unbiased advice can save you thousands and help you feel confident in your plan.

As your Alberta mortgage broker, I can help you:

• Monitor rate changes and lender specials
• Compare fixed and variable options for your situation
• Lock in the best available rate before markets shift
• Understand your budget and approval options
• Reduce stress and avoid surprises during the homebuying process

If you’re thinking about buying in 2025 or 2026—or renewing your mortgage soon—now is the right time to talk strategy. Send me a message to get started today.