Market Update · October 6, 2026
Fixed mortgage rates just went up again. Here's what to do before October 28.
By Sami Juneja · 5 min read
Five of the lenders I work with raised fixed rates before markets opened Monday — on 3-year and 5-year terms.
This isn't a one-off. In recent weeks, all Big Six banks have raised fixed rates. CIBC and TD added 0.20% on September 29. Across other Canadian lenders, recent increases have ranged from 5 to 40 basis points.
A 0.20% increase on a $500,000 mortgage (4.34% vs 4.54%, 25-year amortization) adds roughly $3,300 in payments over a 5-year term.
Why it's happening
- Bond yields. Fixed rates follow the 5-year Government of Canada bond yield. It hit about 3.73% on September 28 — up more than 1% since late February (~2.6%).
- Inflation. Canadian CPI reached 3.0% in August, driven by a 22.8% jump in gasoline prices from Middle East supply disruption.
- Hike expectations. Bond markets are pricing in about 1% of Bank of Canada hikes over the next 12 months.
What could come next: three dates to watch
| Date | What happens |
|---|---|
| Mid-October | September CPI report. Another hot print raises the odds of a hike. |
| October 28 | Bank of Canada decision. The policy rate has held at 2.25% since October 2025. |
| December 9 | Final decision of 2026. If October holds, this is the next window. |
Not everyone expects hikes. Governor Macklem says the Bank won't be "too slow" to respond if inflation becomes persistent. But core inflation sits near 2%, and TD Economics still expects a hold through 2026. The real question is whether this is an energy shock that fades, or the start of something stickier.
Fixed vs variable today
Best 5-yr fixed
4.34%
≈ $2,723 / month
Best 5-yr variable
3.40%
≈ $2,470 / month
A 0.94% gap is about $253 a month on $500,000. That's a real cushion — but every Bank of Canada hike shrinks it. If you choose variable, have a plan for what you'll do if it goes up.
Best available rates published by Ratehub, October 6, 2026. Payments: $500,000, 25-year amortization, semi-annual compounding, illustrative only. Rates change daily and depend on qualification.
What I'm telling my clients right now
- Renewing in the next 4 months? Get a rate hold now. Many lenders hold up to 120 days. It's free, and you can still take a lower rate if one comes. See the mortgage renewal page.
- Pre-approved buyer? Check your rate-hold expiry date today. An expired hold reprices at today's rates.
- Considering variable? Run your break-even. Know how many hikes you can absorb before fixed would have been cheaper — try the payment calculator.
Common questions
Why are fixed mortgage rates going up in October 2026?
Fixed rates follow the 5-year Government of Canada bond yield, which reached about 3.73% on September 28, 2026 — up more than one percentage point since late February. Higher inflation (3.0% in August) and markets pricing in Bank of Canada hikes pushed yields up, and lenders raised fixed rates to match.
When is the next Bank of Canada rate decision?
October 28, 2026. The policy rate has been 2.25% since October 2025. The final decision of 2026 is December 9.
Should I get a rate hold if I'm renewing soon?
If you renew within the next four months, yes. Many lenders hold a rate for up to 120 days, it costs nothing, and you can still take a lower rate if one becomes available.
Is variable still cheaper than fixed?
Yes, for now. On October 6, 2026 the best published 5-year variable was about 3.40% versus about 4.34% for the best 5-year fixed — roughly $253 a month less on a $500,000 mortgage. Every Bank of Canada hike would shrink that gap.
Sources: Yahoo Finance (Oct 5, 2026), Canadian Mortgage Trends (Oct 1, 2026), money.ca, Ratehub (Oct 6, 2026). Educational only — not financial advice. Rates subject to change and OAC approval. Sami Juneja, Mortgage Broker — Mortgage Centre Canada, independently owned and operated by Get A Better Mortgage Inc., FSRA #10874.