Canadian mortgage rates aren't just moved by domestic inflation but by U.S. inflation too, especially by the Fed's favourite core PCE measure.

On that note, today's April core PCE numbers hit the Street's target with the precision of a Swiss watchmaker:

It's been getting harder for banks to make money, as evidenced by today's rare RBC profit miss. A big culprit is the evolving economic forecast, one which now reads "more dreary with a chance of defaults." That's leading banks like RBC to stockpile larger-than-expected loan loss reserves.

Canada’s Big Six are also watching renewal waves hit like a fiscal tsunami, and most are strongly shoving customers toward multi-product relationships, something their #monoline# competitors can't really do.

Below, we unpack all this and more, highlighting each bank's Q2 mortgage reveals.

Bond yields did a quick jig upward after last night's court challenge of Trump tariffs (those tariffs were reinstated during appeal less than 24 hours later).

Rates subsequently reversed course and headed south the moment Thursday's economic data hit the wire.

Here's more on what drove rates today, and in which direction:

Late Wednesday, a U.S. trade court ruled several of Trump's tariffs unconstitutional. At first glance, this looks like a win for Canada.

The court slapped an injunction on most tariffs (more on that). However, the automotive, steel and aluminum duties survive, according to Capital Economics.

Before the mortgage world starts celebrating, however, this development raises more questions than a philosophy exam, namely:

It was a quiet Wednesday where Canadian yields floated with broader market trends rather than specific domestic events.

Here's what nudged rates, and in which direction:

Canada's mortgage market eagerly awaits the final verdict on whether regulators will replace the federal mortgage stress test (a.k.a., "MQR") with their new loan-to-income (LTI) test. On Tuesday, MLN got new intel on this from our banking gatekeepers.

The regulator told us:

The Finance Department and Bank of Canada better keep those foreigners happy.

That's the takeaway from a National Bank report that showed foreign investors now control ~36% of our federal debt. The long-term average is 23%.

Foreign investors bought a record $91 billion worth of Canadian IOUs (bonds and Treasury bills) in the 12 months ending March 31, 2025. That's nearly 60% of the new debt churned out during that period. And it's a good thing they were bidding because Ottawa is set to amass a colossal pile of fresh #GoC# debt by March 31, 2026 (see chart below).
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For those with mortgages, it's like watching a suspense thriller where the climax is the interest rate. But what does this mean for borrowers?

Three things, among others:

It was a cautious day in the bond market, but trade vibes got suddenly more chipper.

Here's what moved Canada's 5-year yield, and in which direction: