Since this rate directly affects variable mortgages, HELOCs, and lines of credit, homeowners have been watching every move closely. Here's what Lendworth borrowers need to know.
A Quick Refresher: Why the Overnight Rate Matters
The Bank of Canada’s key interest rate — also known as the policy rate, overnight rate, or benchmark rate — sets the tone for the cost of borrowing across the country. When the BoC moves the rate up or down, lenders follow.
Rate drops = Cheaper variable mortgages & HELOCs
Rate increases = Higher borrowing costs
Rate hold = Stability, but no new relief for borrowers
After a steady easing cycle beginning in April 2024, the BoC has trimmed the benchmark rate from 4.75% to 2.25% — its current level.
And now? Experts say the central bank is ready to hit pause.
Why Experts Predict a Rate Hold on December 11th
Penelope Graham, mortgage analyst at Ratehub.ca, says the Bank of Canada appears comfortable holding at 2.25% after signalling that the rate is “appropriate to support the economy and temper inflation.”
In other words:
📉 Inflation is cooling
📈 GDP surprised economists with positive growth
⚠️ But risks remain in trade and global markets
Because government spending boosted third-quarter GDP, the country avoided technical recession — a major reason the BoC doesn’t feel pressured to cut further.
Current Inflation: Stable Enough for a Pause
Canada’s CPI inflation rate is around 2.5%, slightly above the Bank’s 2% target but not enough to trigger hikes.
A rate increase is extremely unlikely.
A rate cut?
Not next week — and likely not early 2026 either.
How a Rate Hold Impacts the Housing Market in Ontario
A pause at 2.25% means:
1. Variable Mortgage Rates Aren’t Likely to Drop Soon
Graham notes that variable pricing is the best it’s been since 2022, with some five-year variable terms as low as 3.45%.
But further reductions aren’t in sight.
2. Fixed Rates Are Under Pressure
Bond yields have been climbing, and fixed rates tend to follow them.
If yields keep rising → fixed mortgage rates may inch up again.
3. Buyers & Renewers Should Lock In Early
If you’re buying, refinancing, or renewing, a rate hold or pre-approval can protect today’s pricing before lenders adjust.
What Lendworth Recommends Right Now
At Lendworth, we’re watching rate trends closely so Ontario borrowers can stay ahead.
Here’s what we advise:
✔ Secure a Rate Hold ASAP
This protects you for 60–120 days while you shop.
✔ Consider Variable if You Want Flexibility
Variable pricing is currently the most attractive since 2022.
✔ Fixed Rates Are Still Strong — But Won’t Stay This Low Forever
If you prefer stability, lock in before bond-market pressure forces lenders to adjust.
✔ For Equity-Based Borrowers
Even if bank rates hold steady, equity-based mortgage products (like second mortgages, HELOC alternatives, and bridge loans) remain stable and fast — no income or credit requirements needed.
Final Takeaway
All signs point to a rate hold on December 10th, and that stability presents a small window of opportunity for Ontario buyers, homeowners, and investors.
Whether you're renewing, refinancing, or purchasing:
📌 Now is the time to lock in your best rate.
📌 Equity-based solutions remain strong regardless of Bank of Canada decisions.
Stay tuned — Lendworth will publish a fast update immediately after the official announcement.