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Mortgage consumers may enjoy an additional quarter of rock-bottom uninsured mortgage rates. That's thanks to delays in RBC's takeover of HSBC Canada.

U.K.-based HSBC now expects RBC's $13.5-billion purchase of its Canadian unit to close in Q1 2024. Initially, it projected the end of this year.

The move coincides with the Competition Bureau's just-announced request for information (RFI)—which solicits feedback from stakeholders. The Bureau is rightly concerned about a "substantial lessening or prevention of competition" thanks to RBC's purchase. Moreover, mortgages are pretty much the regulator's #1 focus, based on HSBC's business makeup, the RFI's wording and a top competition lawyer we consulted.

Avid rate-watchers monitor interest rate spreads all the time. Among other things, spreads help project the likelihood of a recession and the path for interest rates.

A spread, or "term spread," simply refers to the difference in yield between two maturities. For example, the most-quoted term spread is the 10-year-minus-2-year, or "10y-2y" for short.

That said, of all the different spreads out there, few are more accurate at predicting recessions than the near-term forward spread (NTFS).

The Fed's likely and much-anticipated 25-bps hike on May 3 is expected to be its last act of tightening this hiking cycle.

If so, it would leave the world's most influential policy rate at the 5.125% peak forecast by the Fed itself in its latest Summary of Economic Projections.

The focus would then shift to speculation on rate-cut timing, and another waiting game would ensue. For the Bank of Canada and Fed to turn dovish at that point, one of two things would have to happen:

The unlikely event of a U.S. debt default could lead to double-digit U.S. inflation, unemployment and GDP losses, and interest rates rising "into perpetuity," Treasury Secretary Yellen warned this week.

In essence, an "economic catastrophe."

That not-so-pleasant thought is why American lawmakers almost certainly won't let it happen. Although, that didn't stop Yellen from cautioning members of Congress—who like to use debt ceiling votes as bargaining chips for partisan agendas—to "not wait until the last minute" to act. Similar brinksmanship in 2011 led to Standard & Poor's downgrading the U.S. credit rating for the first time in history.

A theoretical jolt to Canada's mortgage market

We've received questions from readers on what a U.S. debt default could mean for Canada's mortgage industry. While consequences are impossible to predict with confidence, one can speculate on at least half a dozen possibilities:

Hana Bank isn't exactly a household name, despite its 42-year history in Canada. But it's a name worth knowing—assuming you're a broker who likes competitive uninsured pricing and flexible underwriting.

Hana is a profitable mid-size Korean bank with $452 billion in global assets. It’s been in Canada's broker channel for 15 years and is well-capitalized. Much of its funding comes from the mothership back home.

For high-volume brokers with varied client types, Hana’s specialties can get deals closed for unique or rate-sensitive files. Here's what you need to know.