For homeowners, the calculus grows fraught. Housing demand, already dampened by years of rate hikes, remains sensitive to even subtle shifts. A recession could suppress prices further, but supply shortages in major cities may prop up valuations. The BoC’s warning that monetary policy “cannot resolve trade uncertainty” underscores the limits of its influence; mortgage rates will ultimately hinge on whether Washington’s trade war escalates or recedes.

A Delicate Dance Ahead

The central bank’s next move hinges on which inflationary force prevails: weaker demand or costlier imports. For now, Macklem’s team insists its priority is maintaining price stability, even as it acknowledges “unusual uncertainty” in its models. Markets are pricing in a modest 40% chance of a rate cut by year-end, though traders remain skittish.

The housing market, a cornerstone of Canada’s economy, is in the crosshairs. While stable rates may soothe nerves temporarily, the BOC’s ominous tone suggests borrowers should brace for volatility. Every tariff tweet from Washington could now sway Canadian mortgage bills. In this climate of perpetual uncertainty, prudence—not prediction—may be the only viable strategy.