🏛 Minority Government: What That Actually Means
Canada’s new Liberal minority government faces an uphill battle. Historically, minority governments in Canada last about 18 months on average. That’s not a lot of time to get meaningful legislation passed — especially without majority support.
To get anything done, the Liberals will need to work with other parties, often trading political concessions in return for cooperation. While this might sound democratic, it can also slow down progress or lead to expensive compromises.
📈 Why the Bond Market & Inflation Still Matter
One of the big concerns post-election is the Liberal budget, which is projected to be costly. High government spending tends to spook bond markets, which raises concerns about inflation. And inflation impacts the one thing most Canadians care deeply about right now: mortgage rates.
If inflation ticks up again, fixed mortgage rates will likely rise, and the Bank of Canada could be forced to delay any potential rate cuts.
🧠 Two Paths Forward: Stimulus or Stalemate?
There are typically two ways to stimulate a sluggish economy:
- The Bank of Canada cuts interest rates
- The government injects capital into the system (like during COVID)
But this time? Neither seems likely — at least not in the way we saw in 2020.
- Inflation is still too high for aggressive rate cuts
- The Liberals’ spending plan may be too expensive to pass without serious compromise
- And with a minority, passing bold new stimulus will be politically difficult
🌍 What About Mark Carney and the U.S.?
Here’s where it gets interesting.
One of the most talked-about aspects of this election was Mark Carney’s potential role in restoring Canada’s global economic position, especially in trade negotiations with the U.S. Many Canadians believe Carney’s experience — as a former Governor of both the Bank of Canada and the Bank of England — could help stabilize our economy.
Recently, Carney had an introductory call with Donald Trump, who referred to him as “quite the gentleman.” What happens next is anyone’s guess. But if Carney can help renegotiate Trump-era tariffs, Canada could see a meaningful boost in trade and investor confidence.
🏠 So, What Does This Mean for You?
If you're renewing your mortgage, planning to buy property, or just trying to stay informed — here’s what to watch:
- Interest Rates: Many economists believe the Bank of Canada will stay neutral for now. Don’t count on rate cuts in the near future.
- Fixed vs. Variable: Fixed rates may creep upward depending on inflation and bond yields.
- Government Policy: If the Liberals can gain support and execute their housing and energy strategies, we could see modest economic growth.
- Your Timeline: If you're up for renewal in the next 6–12 months, it’s more important than ever to review your options early and shop aggressively.
🧭 Our Advice? Be Proactive
This election changed a lot — but one thing hasn’t: the importance of having a plan. Whether rates go up, down, or sideways, your mortgage shouldn’t be left to chance.
We’re here to help you navigate it — no jargon, no BS, just real advice.
👉 Book a free strategy call with our team or check out our full video breakdown on YouTube for a deeper dive.
Pilot Mortgage
Helping Canadians make smarter mortgage decisions, every step of the way.
