Back in September I wrote about my family’s wine making tradition.
Come January/February, another culinary tradition descends upon us — cured meats! In particular, a staple every year is our Italian Sopressata (it’s basically a salami).
Long before the charcuterie board became a mainstream thing, our family was getting together once a year and slaving away for a whole weekend preparing these salty cured meats, and then another three months or so curing them.
Growing up I hated this tradition. Mostly because my parents would give us very little notice.
On a Friday morning we would be told that we would have to cancel any plans that weekend because it is “salami weekend.”
As I got older, I started to appreciate it a bit more.
Eventually I even started a new salami making tradition with some good buddies.
It’s such a great day. We work hard, but we have a blast. We think that this year may have been our 10 year anniversary… but we’re not certain.
I bring this up for a reason…
Over the years we’ve become extremely efficient at making salami.
Our processes versus what our parent’s would do, is much different.
What used to take a full three-day weekend, now takes only one full day.
Why? Because rather than just going through the motions and doing things a certain way because “that’s how it’s always been done,” we question and look for better ways to do things.
Over the last several years, we’ve developed a system that has allowed us to save time, save money, require less physical labour, and ultimately produce (in our humble opinion) a better end product.
A System is defined as a set of principles or procedures according to which something is done; an organized framework or method.
Systems are important because they provide predictable results.
No system, no predictable results.
Speaking of predictable…
Yesterday, the Bank of Canada held its first meeting of 2024, and as expected they announced that they would continue to HOLD rates.
At this same meeting just twelve months ago, the Bank of Canada was in all-out rate hike mode and announced for the 8th time in a row that they would yet again be increasing rates.
For those keeping track, the BOC has now held rates for 6 straight months, and we’ve only seen two small rate increases (25 bps each) in the last 12 months.
The next BOC meeting is in March, and unless January and February inflation numbers come in much higher than expected, we expect much of the same at that meeting (i.e. another HOLD).
Our view is that you will likely start hearing some language from BOC (probably starting at the March meeting), suggesting FUTURE interest rate cuts. But those interest rate cuts likely won’t happen until later in the summer or into the fall.
What does this mean for current mortgage rates?
Prior to this month, Canadian bond yields had been on a consistent downtrend for nearly 3 months, and fixed mortgage rates pretty much followed suit. At one point, the 5-year fixed rate got as low as 4.89%.
That said, as Bond yields have started to increase, and so have mortgage rates. And we see this trend continuing or staying flat, until the BOC starts hinting towards rate cuts.
If you have an upcoming mortgage renewal or plan to take out a new mortgage in the short term, we encourage you to reach out to your broker soon, to lock in a rate, to protect yourself from any potential short term rises in fixed rates.
If your borrowing needs are further out, we still encourage you to sit down with your mortgage broker, discuss your plan and put systems in place to achieve that plan.
With all the noise and chatter around interest rates these days, it’s easy to get caught up in the news and opinions of today, even if you are not impacted by today’s rates.
It’s important to know your own time horizon, look at the bigger picture of what’s going on around you, and make decisions that are inline with your specific situation.
If you need help with this… please reach out. We’re here for you.
All the best,
Vince
