Welcome to the latest episode of Make Money Count! The world’s attention turned once again to U.S. trade policy this week as the Trump administration rolled out its latest round of global tariffs. In a move that felt more like a high school science fair than international economic policy, President Trump revealed a display board outlining new tariffs on virtually every country — with the curious exceptions of Russia and North Korea.

But what does that mean for Canadians? Well, a lot. Tariffs, especially at this scale, don’t just influence international trade — they send shockwaves through financial markets, affect interest rates, and shake consumer confidence. And in Canada, where our housing market is already under pressure, the stakes are high.

Episode Highlights

The Tariff Fuse is Burning Faster

There’s some optimism that the aggressive tariff strategy may push the U.S. administration into faster negotiations with key partners like Canada and Mexico. If that happens, we could see more clarity and stability in our trade relationships — and that certainty would be good for jobs, economic growth, and interest rate direction in Canada.

Bond Yields Are Down — So Are Mortgage Rates

As of this writing, the five-year Government of Canada bond yield is hovering below 2.4%. That’s important because five-year fixed mortgage rates are directly tied to this yield. Right now, we’re seeing five-year fixed mortgage rates dip to the 3.6%–3.7% range — some of the most competitive rates in recent memory.
But hold on — variable rates may be about to move too.

Bank of Canada: All Eyes on April 16

Currently, the overnight rate sits at 2.75%, and the prime rate is 4.95%. But with a disappointing jobs report and global uncertainty mounting, there’s now a 61.5% probability that the Bank of Canada will cut rates by 25 basis points on April 16.

And that’s not all — economists are now predicting three rate cuts by the end of 2025, pushing the overnight rate down to 2.0% or even 1.75%.

So what does this mean for homeowners and buyers?

Why Lower Rates Won’t Save the Housing Market — Yet

Here’s the thing: a quarter-point rate cut isn’t going to move the needle much when it comes to real estate prices. Consumer confidence is still extremely low, and listings are piling up in markets like Toronto. In fact, March data shows real estate sales hitting decade lows, while new listings are skyrocketing.

Many homeowners are selling not because they want to, but because they have to. With rising mortgage payments and fewer job prospects, pressure is building.

The Stagflation Conundrum

Canada is heading into what’s shaping up to be a stagflationary period — slow growth, high prices, and a weak Canadian dollar. And that puts the Bank of Canada in a tough spot: they need to stimulate growth and control inflation at the same time.

But there is some light at the end of the tunnel. While tariffs and a weak loonie might raise prices in the short term, we don’t expect long-term inflation to stick. Why? Because the job market is weakening — and without rising wages, inflation can’t sustain itself.

Bottom Line

Are you a homeowner, investor, or just someone trying to make sense of the economic headlines? Know this: lower mortgage rates are coming, but they won’t be a silver bullet for the housing market. What will matter more is job stability, consumer confidence, and clarity in trade policy.

Stay informed, stay flexible — and if you’re exploring your mortgage options, now’s a great time to talk to someone who has your back.

👉 Need help deciding between fixed and variable? We’re here to help.