Waiting for the Next Bank of Canada Rate Decision Before Choosing Fixed or Variable Rate?

There’s no shortage of choices when it comes to selecting the right mortgage. Amortization, term length, payment frequency, rate type, and of course, the professional you choose to guide you through it all. It’s the last two that generally require the most thought. When choosing the right professional, most people look at experience, reputation, response time, reviews, and overall professionalism. A better rate doesn’t hurt either. The question of fixed versus variable is a deeper one, which I explored in detail in . But there’s one thing that guide doesn’t cover: whether it makes sense to wait for the next Bank of Canada rate announcement before deciding.

Basing Your Decision on the Next Bank of Canada Announcement  

Some mortgage shoppers want to hold off until the next rate announcement to see what happens. In some cases, the Bank’s decision might be easily predictable… yet some still want to wait to be sure. But if you want to ‘be sure’ then this contradicts the decision to go with a variable rate in the first place. There is nothing sure about variable rate mortgages. I digress. 

It’s important to remember that there are 40 scheduled BoC announcements over the five year term. Why should the next one carry so much weight? Let’s say there’s a 50/50 chance of a cut. If the Bank holds, you might decide to go fixed… only to see them cut with the following announcement… or the one after that. Or they could cut now, then hike later. The point is that the announcement you’re waiting for is just one in a long series.

If you find yourself waiting for the announcement before deciding, that probably means you’re less comfortable with the ups and downs that come with a variable rate. In that case, a 

fixed rate might be a better fit for you. 

Ask yourself these two questions:

• How would I feel if the rate dropped on the next announcement but started rising again soon after?

• How would I feel if the rate began to increase sooner and more often than expected?

While this is not what’s currently being forecasted, you need to be comfortable with the unexpected if choosing a variable rate. If the answers to these questions make you anxious, then a variable rate is likely not for you. Choosing between fixed and variable ultimately comes down to your tolerance for risk. And if your decision hinges on one announcement out of the 40 additional announcements to come, your comfort level likely leans toward fixed.

The Rate Market May Throw You a Curveball – Important! 

Variable rate discounts can change. When the Bank of Canada cuts rate, lenders may then choose to reduce their variable rate discount, resulting in a higher rate. This has happened multiple times over the last year. 

Fixed mortgage rates can also change. They could drop, but they could just as easily rise. Even when rates seem stable, or with downward pressure on rates, promotional pricing can vanish overnight, which could leave you with no choice but to accept a higher rate. 

As I said in my recent blog, , the only way to guarantee you’ll get today’s lowest rate is to secure something without hesitation. 

We just learned that the lender currently leading the market with the best rates in several categories will end their special pricing on October 17. That means higher rates for both fixed and variable products afterward. Waiting, in this case, comes at a cost. The direction of bond yields is not relevant in this case. 

If you lock in a rate now, you are not committed to that choice.  We can still switch you to another product or even another lender… but it will be at the lowest rates available at that time, not the rates available to you today. 

Current Bank of Canada Forecasts 

Market odds of a rate cut on the Bank of Canada’s next scheduled announcement date on October 29th are currently sitting at 59%. That leaves one more scheduled announcement in 2025 which will occur on December 10th. 

Here are the latest forecasts: 

Bank	Last Report	Q4 2025	Q1 2026	Q2 2026	Q3 2026	Q4 2026	Total Change
CIBC	Oct 1	-0.25%	N/C	N/C	N/C	N/C	-0.25%
RBC	October	-0.25%	N/C	N/C	N/C	N/C	-0.25%
Scotia	Sept 11	-0.25%	N/C	N/C	+0.25%	+0.25%	+0.25%
TD	Sept 18	-0.25%	N/C	N/C	N/C	N/C	-0.25%
BMO	Oct 10	-0.25%	-0.25%	N/C	N/C	N/C	-0.50%
NBC	Jul/Aug	-0.50%	N/C	N/C	N/C	N/C	-0.50%

‘Last Report’ indicates when the forecast was updated. RBC and National Bank (NBC) only provide the month.

The most optimistic forecast suggests a 0.50% drop in prime by Q1 2026, from BMO and National Bank. Scotiabank expects hikes in the second half of 2026. National Bank even predicts three more increases in 2027, though that’s far enough out that it’s anyone’s guess.

Final Thoughts

There are many who choose to wait to lock in a rate. They may be shopping around trying to find something lower, or they may be waiting for the Bank of Canada’s rate announcement. But there is no benefit to waiting. You’re putting yourself at risk of paying higher rates by the time you make the decision. Your choice is not set in stone, and we can always convert you to a different product or lender should you change your mind. 

Trends can change, as can forecasts. New economic information continues to materialize, which can alter mortgage rates in a heartbeat. With one lender putting an end to their special pricing, waiting will unfortunately result in higher rates for many.  If you have a purchase closing or a mortgage renewal within the next 120 days, the best time to act is now.