Royal Bank of Canada signalled a strategic retreat in the ongoing mortgage wars Monday, announcing it will stop offering its rock-bottom 2.99% discount mortgage by Thursday.

Effective March 29, the special four-year fixed closed mortgage will jump to 3.49%, a 0.50 percentage point increase.

RBC will also raise its five-year closed rate to 5.44%, a 0.20 percentage point increase, and its variable five-year mortgage to prime plus 0.20%, a 0.10 percentage point increase.

The Bank of Montreal was the first Canadian bank to introduce a 2.99% mortgage over a five-year term in January. The other banks soon followed with a four-year offer at the same rate.

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