Variable Rate Update – Reaching Escape Velocity?
March 9, 2016
Variable Rate Update – Third Quarter a Charm?
May 25, 2016
The Bank of Canada (BOC) left the prime rate unchanged today citing the weakness in the global economy, the significant slack in labour production capacity and lacklustre exports. The only economic good news on the horizon is the Federal Governments stimulus plan which the BOC is hoping will pick up the economic slack.
This meeting provided more economic information since it included the Monetary Policy Report. For a copy of the full report click here. It’s actually a pretty easy read!
Key Points From The Bank of Canada Announcement
Prime rate not changed - Estimates for global growth reduced
- Exports not as strong as predicted
- Solid fundamentals in the US will help CDN exports
- Oil prices appear to be stabilising
- Liberal budget expected to make up for global economic shortfalls
How Your Mortgage Is Impacted
- Prime rate remains at 2.7%
- The Spring Market has brought the usual rate wars
- Variable rate mortgage pricing getting sharper
- Rate holds for purchases or maturities is now available until August
The Bank of Canada (BOC) left the prime rate unchanged today citing the weakness in the global economy, the significant slack in labour production capacity and lacklustre exports. The only economic good news on the horizon is the Federal Governments stimulus plan which the BOC is hoping will pick up the economic slack.
This meeting provided more economic information since it included the Monetary Policy Report. For a copy of the full report click here. It’s actually a pretty easy read!
Where are rates heading?
It looks like the Bank of Canada is not expecting any pressure on interest rates until January 2017. This means that the variable rates will stay where they are, but the fixed rates will fluctuate. With the Bank of Canada expecting real growth to be uneven in the near term, I would expect interest rates to possibly increase by 5bps to 10bps as the Spring Market comes to an end and if we see some positive economic numbers come in.
Give me a call! We can discuss how your current financial situation fits into today’s economic environment and how the right mortgage strategy could save you thousands of dollars over the term of your mortgage.
The next Bank of Canada meeting is May 25th, 2016
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