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Scotia Leads Posted Rates Lower & Launches 2-Year Special

ScotiabankAfter a month of plunging bond yields, a major bank has finally decided to lower its posted 5-year fixed rate.

Scotiabank has just announced a 20 basis point cut to its 5-year fixed mortgage. Several of its other fixed rates are falling as well (between 6-20 bps), effective tomorrow.

Scotia is setting its new 5-year fixed posted rate at 5.19%. That matches the lowest posted rate of the last 50+ years, and is a rate we last saw in February of this year.

If history is a guide, other banks will likely cut their own posted rates in the next few days.

Scotia also announced two other noteworthy changes today:

  • Its discounted two-year fixed is now 2.49%. That’s one of the lowest bank-advertised two-year rates we can remember. It’s also a decent alternative to today’s 2.30% variables because it provides two years of rate protection for just a 19 bps premium.
  • Scotia’s advertised variable-rate discount is shrinking by 20 basis points to prime – 0.30%. Even its broker pricing, which has been notably better than advertised rates, is going up.

Rob McLister, CMT