What Canada’s latest inflation reading means for mortgages
“Risks around that forecast are increasingly tilted toward an earlier hike, particularly if elevated energy prices persist while the economy and labour market continue to recover,” she said.
The latest Bloomberg Nanos Canadian Confidence Index from Nanos Research shows Canadians remain relatively confident about their jobs and finances, but less optimistic about housing and the economy.https://t.co/qYxJN788Vh
— Canadian Mortgage Professional Magazine (@CMPmagazine) September 10, 2026
Bond markets may have moved too far
Leslie Preston, managing director and senior economist at TD Economics in Toronto, pointed to a notable disconnect between market pricing and the underlying print.
Before August’s release, the two-year Government of Canada bond yield had risen more than 40 basis points over the prior month as traders priced in rate increases.
“We don’t think today’s inflation report supports this degree of tightening,” Preston said.
Core inflation was moving higher, she added, “but off a very low level, and is expected to remain within the BoC’s comfort zone” — particularly as US tariffs continue to drag on Canadian growth.
