This shift in sentiment has major implications for borrowers, homeowners, and real estate investors—especially those navigating an already fragile housing market.
At Lendworth Financial, we’re helping clients adjust to this changing rate environment with flexible, equity-based lending solutions that don’t rely on traditional bank financing.
🔒 Why Further Rate Cuts Are Unlikely
The Bank of Canada’s policy rate currently sits at 2.75%, squarely within what economists call the "neutral range"—a level that neither stimulates nor restrains economic growth. After seven rate cuts between June 2024 and March 2025, many thought there was more room to go. But now, leading economists are urging caution.
Despite a headline inflation rate of 1.7%, core inflation—the Bank’s preferred measure—remains stubbornly high at 3.0%, far above the 2% target. Experts argue this is a red flag that prevents further easing.
“Forget the headline,” one economist noted. “Core inflation is still too hot.”
🌍 The Trade War Factor
Complicating matters is the ongoing trade standoff with the U.S. Canada currently faces steep tariffs—up to 50% on aluminum and steel, and 25% on auto parts and non-USMCA goods. These disruptions are putting pressure on supply chains and driving up costs—just as policymakers are trying to tame inflation.
Prime Minister Mark Carney and President Donald Trump have set a July 21 deadline to reach a trade and security deal. Until there’s resolution, the Bank of Canada is expected to keep rates steady to avoid triggering further volatility.
🧾 Fiscal Policy vs. Monetary Policy
Adding another layer to the conversation is the anticipated federal budget this fall, which could include new consumer stimulus measures. Economists caution against overcorrection—stimulus spending combined with low interest rates could reignite inflation, forcing policymakers into another round of painful rate hikes later.
As one expert put it: “Canada must avoid repeating the 2024 mistake—overstimulating the economy from both ends.”
🔮 What This Means for Borrowers
If you’re waiting for lower rates to refinance, it may be time to rethink your strategy. The days of ultra-cheap borrowing are likely behind us—at least for now. But that doesn’t mean you’re out of options.
At Lendworth, we offer alternative mortgage solutions designed for today’s environment:
✅ Second mortgages for equity takeout
✅ Bridge loans for buying before selling
✅ Debt consolidation to manage monthly payments
✅ Home renovation loans without bank red tape
✅ Custom financing options for self-employed or credit-challenged borrowers
Whether rates hold steady or shift again later this year, Lendworth is positioned to provide fast, flexible funding when the banks say no.
📞 Let’s Talk About Your Options
With uncertainty in the market, now is the time to secure financing based on your equity—not your credit score.
👉 Call us today or visit www.lendworth.ca to explore your options.
Let Lendworth help you move forward—no matter what the Bank of Canada does next.