Canada’s 2025 Budget Could Trigger a Credit Downgrade

Canada’s 2025 budget is putting the country’s credit rating at risk — and that could mean higher mortgage costs for Canadians. Fitch Ratings has warned that rising deficits and debt could weaken Canada’s credit profile and push up borrowing costs. But as this video shows, the real driver of fixed mortgage rates isn’t Ottawa—it’s Washington. #canadianeconomy #canadanews #budget2025 Persistent Fiscal Expansion Underscores Canada Rating Pressures: https://www.fitchratings.com/research/sovereigns/persistent-fiscal-expansion-underscores-canada-rating-pressures-06-11-2025 Federal budget deficit nearly twice the size forecast by Liberals: https://www.ctvnews.ca/canada/article/federal-budget-forecasts-78b-deficit-as-liberals-shift-spending-to-capital-projects/ Rising debt to weigh on Canada’s credit strength: https://www.investmentexecutive.com/news/rising-debt-to-weigh-on-canadas-credit-strength/ Fitch Warns Canada of Credit Downgrade—That’s Bad News For Mortgages: https://betterdwelling.com/fitch-warns-canada-of-credit-downgrade-thats-bad-news-for-mortgages/ Brian Lilley: Fitch issues warning on Canada's fiscal control: https://tradersunion.com/news/market-voices/show/821531-fitch-canada-warning/ With Moody's downgrade, US loses treasured Aaa credit rating: https://www.reuters.com/business/view-with-moodys-downgrade-us-loses-treasured-aaa-credit-rating-2025-05-16/ A $78B deficit, public service cuts, new tax measures: Highlights of budget 2025: https://www.cbc.ca/news/politics/budget-highlights-9.6966595 Canada Strong – Budget 2025: https://budget.canada.ca/2025/report-rapport/pdf/budget-2025-our-plan.pdf The linchpin behind Canada’s fiscal advantage?: https://www.nbc.ca/content/dam/bnc/taux-analyses/analyse-eco/mkt-view/market_view_250530.pdf Policy interest rate: https://www.bankofcanada.ca/core-functions/monetary-policy/key-interest-rate/ Variable-rate mortgages are making a comeback, but some economists are already predicting rate hikes: https://www.theglobeandmail.com/investing/personal-finance/article-variable-rate-mortgages-are-making-a-comeback-but-some-economists-are/ Canada 5 Year Bond: https://www.cnbc.com/quotes/CA5Y-CA Do sovereign credit ratings affect the yields on sovereign debt? An exploration of the effect of monetary sovereignty: https://modernmoneylab.org.au/wp-content/uploads/2021/06/Working-Paper-Matthew-Crocker.pdf Fitch Downgrades Canada's Ratings to 'AA+'; Outlook Stable: https://www.fitchratings.com/research/sovereigns/fitch-downgrades-canada-ratings-to-aa-outlook-stable-24-06-2020 Canada 5 Year Government Bond: https://www.marketwatch.com/investing/bond/tmbmkca-05y?countrycode=bx Fitch Downgrades France to 'A+'; Outlook Stable: https://www.fitchratings.com/research/sovereigns/fitch-downgrades-france-to-a-outlook-stable-12-09-2025 U.S. 10 Year Treasury Note: https://www.marketwatch.com/investing/bond/tmubmusd10y?countrycode=bx Canada 5Y yield: https://www.tradingview.com/symbols/TVC-CA05Y/ 'Sell America' is back as long-dated Treasurys hit 5% in wake of Moody's downgrade: https://www.businessinsider.com/treasury-yields-moodys-rating-downgrade-us-economy-trump-2025-5 Data Fog Intensifying for Fed as Shutdown Delays US Inflation Numbers: https://financialpost.com/pmn/business-pmn/data-fog-intensifying-for-fed-as-shutdown-delays-us-inflation-numbers Back-to-back disappointing economic reports renew fears of 'stagflation': https://katu.com/news/nation-world/disappointing-economic-reports-renew-fears-of-stagflation-inflation-economy-federal-reserve-finances-spending-groceries-home-sales-gas-prices-gdp-united-states-government-data-history-target Mark Mitchell – Mortgage Broker London Ontario 920 Commissioners road east London, Ontario N5Z 3J1 Phone: (519)860-2102 (Call or Text) MarkMitchell@LondonOntarioMortgages.ca Brokerage Lic: 10464 Broker Lic: M16001479 https://www.LondonOntarioMortgages.ca – Apply Online!! Youtube Channel: https://www.youtube.com/c/MarkMitchellMortgageBrokerLondonOntario Subscribe NOW for more Mortgage/Financial News/Videos. Follow me on Social Media: Instagram - https://www.instagram.com/mortgagebrokerlondonontario Facebook - https://www.facebook.com/londonontariomortgages Twitter - https://twitter.com/londonmortgage1/ LinkedIn - https://www.linkedin.com/in/mark-mitchell-london-s-mortgage-broker-197842123/ TikTok - https://www.tiktok.com/@mortgagebrokerlondon?lang=en Commentary on this Channel should not be considered financial advice