Edmonton Economy · Bank of Canada
Interest rates & Edmonton mortgages
As of August 2026, the Bank of Canada's policy rate is 2.25% — down 2.75 points from its 5.00% peak in Jul 2023 as the Bank has eased. Prime sits at 4.45%, the benchmark for variable-rate borrowing. Fixed mortgages follow a different lever — the 5-year Government of Canada bond yield, currently 3.31%. For Edmonton buyers, these national rates set how much home a monthly payment can carry.
Policy rate
2.25%
as of Aug 17, 2026 · −0.50 pts vs a year ago
Prime rate
4.45%
as of Aug 12, 2026 · −0.50 pts vs a year ago
5-year GoC yield
3.31%
as of Aug 17, 2026 · +0.33 pts vs a year ago
CORRA
2.27%
overnight funding · as of Aug 17, 2026
Policy vs peak
−2.75 pts
from 5.00% (Jul 2023)
5-yr yield vs peak
−1.11 pts
from 4.42% (Oct 2023)
What these numbers mean
The policy (overnight) rate is the interest rate the Bank of Canada sets — the cost of overnight lending between banks — and it anchors everything else. The prime rate is what lenders base variable-rate products on (variable mortgages, HELOCs, lines of credit); it moves step-for-step with the policy rate. The 5-year Government of Canada bond yield is the return on a five-year federal bond set by the market — lenders fund five-year fixed mortgages against it, so it drives fixed pricing. CORRA (the Canadian Overnight Repo Rate Average) is the market-set benchmark for overnight funding, a companion to the policy rate.
How these rates reach an Edmonton mortgage
Two rates do two different jobs. The policy rate sets the prime rate, which prices variable-rate mortgages and lines of credit. Fixed mortgages follow the bond market instead: lenders fund a five-year fixed mortgage against the five-year Government of Canada bond and add a spread, so fixed rates track the yield — not the policy rate directly.
That is why a fixed rate can move weeks before the Bank of Canada changes anything, and why the policy rate and the 5-year yield don't always move together: since their 2023 peaks, the policy rate has fallen 2.75 points while the 5-year yield is down 1.11 (see the chart below).
For affordability the mechanism is simple: the rate sets how much home a monthly payment can carry. When borrowing costs rise, the same payment supports a smaller mortgage; when they fall, it supports more. After the purchase price itself, the rate is the biggest single swing factor in Edmonton buying power — which is why these national numbers matter on a local deal.
Posted vs. what you'll actually pay
The Bank of Canada's posted 5-year rate is a ceiling — it exists for stress-test and penalty math, and almost nobody pays it. What matters is the lowest rate lenders are actually advertising. Here is the gap.
Posted sits above the best advertised rate by
2.05 points
6.09% posted − 4.04% best advertised
Posted 5-yr (the ceiling)
6.09%
Bank of Canada · as of Aug 12, 2026
5-yr GoC yield (the driver)
3.31%
fixed rates price off this · as of Aug 17, 2026
| Scenario | Fixed | Variable | Variable is lower by |
|---|---|---|---|
| Insured / high-ratioowner-occupied, under 20% down | 4.04% | 3.40% | 0.64 pts |
| Conventional20%+ down & refinances, owner-occupied | 4.39% | 3.75% | 0.64 pts |
| Rentalnon-owner-occupied, 20%+ down | 4.54% | 3.95% | 0.59 pts |
These are the lowest rates being advertised, which is a floor — not a survey of what lenders will actually do. Lenders publish on very different terms: the sharpest advertised rates generally come through broker channels that compete on published price, while some lenders list rates at or near posted and discount privately once you apply. A borrower with a strong application can often negotiate below a lender's published rate. So treat the figures above as a benchmark for where the market is and which way it is moving — the rate any one borrower is offered is set by their own application.
Three scenarios, because what the mortgage is for changes the rate. The insured / high-ratio row is an owner-occupied purchase with less than 20% down: the lender is covered against default, so it prices lowest. Conventional is what a 20%+-down purchase or a refinance prices against. Rental applies when the property is not owner-occupied, and sits highest — a rental can't be default-insured the ordinary way, so the lender funds it through a costlier channel and carries the risk itself. Today the fixed ladder spans 0.50 points end to end. There is a fourth tier these figures can't show: insurable — 20%+ down that still meets insurer criteria, which the lender insures at its own cost and prices between insured and conventional. A broker may quote it.
Fixed and variable answer to different levers, which is why both are shown. A fixed rate prices off the Government of Canada bond yield (3.31%) plus a lender spread, and that spread is not constant — which is why these are real cited rates, not numbers estimated from the yield. A variable rate moves with the prime rate (4.45%) for the whole term, so the figure shown is a starting point rather than a locked cost.
They also break differently, which can outweigh the gap above. Closed variable mortgages almost always charge three months' interest to break. Closed fixed mortgages charge the greater of three months' interest or an interest-rate differential (IRD) — the lender's estimate of the interest it loses by re-lending at today's rate. Which of the two applies depends on whether rates have fallen since the mortgage was signed. The part worth asking about is how a lender calculates its IRD: big banks typically base it on their posted rates, which inflates the penalty well beyond what monoline lenders and many credit unions charge using contract rates. On the same balance that difference can run into five figures, so on a property that might be sold or refinanced mid-term it deserves as much attention as the rate. Ask any lender to show you its penalty calculation in writing before signing.
Rates shown here are the lowest advertised rates from a third-party source, for general market context — not a personal quote, an offer, or financial advice. Your rate depends on your down payment, credit, and whether your mortgage is insured. For an actual rate, talk to a licensed mortgage broker.
The yield curve — rates by term
Fixed mortgages don't all price off the same number. Each fixed term tracks the Government of Canada bond of the same length, so the whole curve matters — a shorter term usually means a lower rate. Benchmark GoC yields as of Aug 17, 2026:
What about the actual mortgage rate? Each fixed term prices off the Government of Canada bond of the same length, plus a lender spread. The 5-year gap between the posted rate and what is actually advertised is broken down in posted vs. what you'll actually pay above.
Where rates have moved
The 5-year Government of Canada yield and the Bank of Canada policy rate, year by year across the recent rate cycle. Watch the gap between the lines: the two climbed and eased on different timing, because fixed pricing answers to the bond market while variable answers to the Bank of Canada.
Reading the chart: each point is that year's year-end value, with 2026 showing the latest reading (Aug 17, 2026). The policy rate (set by the Bank of Canada) moves in steps on decision dates; the 5-year yield (set by the bond market) moves continuously.
The numbers behind the chart
Year-end policy rate and 5-year Government of Canada yield (the latest reading in each year).
| Year | Policy rate | 5-yr GoC yield |
|---|---|---|
| 2020 | 0.25% | 0.39% |
| 2021 | 0.25% | 1.25% |
| 2022 | 4.25% | 3.41% |
| 2023 | 5.00% | 3.17% |
| 2024 | 3.25% | 2.96% |
| 2025 | 2.25% | 2.96% |
| 2026 (latest) | 2.25% | 3.31% |
Canadian interest rates & mortgages — FAQ
What is the Bank of Canada's policy interest rate right now?
As of Aug 17, 2026, the Bank of Canada's policy (overnight) rate is 2.25%, and the prime rate most lenders post is 4.45%. The Bank last changed the policy rate on Oct 30, 2025, when it cut it from 2.50% to 2.25%. That is 2.75 percentage points below its 5.00% peak in Jul 2023.
What is the difference between fixed and variable mortgage rates?
Variable-rate mortgages, HELOCs and lines of credit move with the prime rate (4.45%), which tracks the Bank of Canada's policy rate (2.25%). Fixed-rate mortgages are priced off Government of Canada bond yields instead — a 5-year fixed off the 5-year yield (3.31%) — so they can move independently of the Bank.
Does the Bank of Canada's policy rate set fixed mortgage rates?
No. Fixed mortgage rates track Government of Canada bond yields, not the policy rate directly. The 5-year GoC yield (3.31%) underpins 5-year fixed pricing, while the policy rate (2.25%) drives variable rates through prime. That is why a fixed rate can rise or fall weeks before the Bank moves.
How much have interest rates changed over the past year?
Compared with a year earlier, the policy rate is −0.50 pts (now 2.25%), prime is −0.50 pts (now 4.45%), and the 5-year Government of Canada yield is +0.33 pts (now 3.31%). From the Jul 2023 cycle peak, the policy rate is down 2.75 points.
How does the 5-year mortgage rate compare to the bond yield?
The 5-year Government of Canada yield is 3.31%; lenders fund 5-year fixed mortgages off that yield and add a spread. The Bank of Canada's posted 5-year conventional mortgage rate is 6.09% — a ceiling, well above what borrowers actually pay. The lowest 5-year fixed currently advertised is about 4.04% insured (4.39% conventional / uninsured, 4.54% on a rental) (Ratehub.ca, as of August 3, 2026) — roughly 2.05 points below posted. Your rate depends on the lender, the term and your application.
Is a variable rate cheaper than a fixed rate right now?
As advertised, yes. As of August 3, 2026, the lowest 5-year variable rate is 3.40% against 4.04% fixed — about 0.64 points lower (Ratehub.ca), and on a rental 3.95% against 4.54% fixed. The catch is that a variable rate is a starting point, not a locked cost: it moves with the prime rate (4.45%), which tracks the Bank of Canada's policy rate (2.25%), so the gap can close or reverse during the term. Variable mortgages are also normally cheaper to break — three months' interest, rather than the interest-rate differential a fixed mortgage can charge. Which one costs less over a full term depends on where rates go, so this is market context, not a recommendation.
Is the mortgage rate higher on a rental or investment property?
Yes. As of August 3, 2026, the lowest advertised 5-year fixed rate on a non-owner-occupied rental is 4.54%, against 4.04% insured and 4.39% conventional for an owner-occupied purchase (Ratehub.ca) — about 0.50 points above the headline rate. A rental can't carry ordinary default insurance, so the lender cannot fund it through the cheapest channel and holds the risk itself. Note also that the very lowest advertised rates are often restricted promotional products that exclude rentals outright, so the practical gap can be wider than the advertised one. Down payment, property type and how a lender treats the rental income all affect the final rate — talk to a licensed mortgage broker for a quote.
How often do these rates change, and how current are the figures here?
The Bank of Canada sets the policy rate on eight scheduled dates a year (it last moved on Oct 30, 2025); prime changes when the policy rate does. Government of Canada bond yields and CORRA move every business day. The figures on this page are a build-time snapshot from the Bank of Canada, each carrying its own "as of" date — the latest is Aug 17, 2026.
About this data
These figures come straight from the Bank of Canada via its public Valet data service — the same source the Bank publishes for the overnight target, prime, the Government of Canada benchmark bond yields and CORRA. They're national rates, pulled fresh each time this page is rebuilt and shown as a snapshot with an "as of" date rather than a live ticker, so what you see is exactly what's in the page source. The policy rate updates only on the Bank's eight scheduled decision dates a year; prime is weekly; the bond yields and CORRA move every business day.
Sources & licence
- Source: Bank of Canada. This information is available free of charge on the Bank of Canada website.
- Lowest nationally-advertised insured, conventional and rental 5-year mortgage rates, per Ratehub.ca (https://www.ratehub.ca/best-mortgage-rates), as of August 3, 2026.
These are national rates — set in financial markets and by the Bank of Canada — that apply right across Canada; they are shown here as context for Edmonton borrowing costs, not as an Edmonton-specific measure. Each figure is the latest published observation as of its own date: the policy rate changes only on the Bank of Canada's eight scheduled decision dates a year, while prime is weekly and the bond yields and CORRA move daily. The posted 5-year conventional mortgage rate is a posted figure, typically above the rates borrowers negotiate.
Content on this site does not constitute financial or investment advice. Trevor Tardif is a licensed REALTOR® with REAL Broker AB Ltd, Edmonton, Alberta.
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