Graham Ogden

B Comm and Realtor®

Direct: 1 780 908-1224 |

Bank of Canada Holds Key Rate

The Bank of Canada announced today that it is holding the benchmark rate steady for the sixth straight time, noting that “the Canadian economy’s complex structural adjustment to the oil price shock is ongoing,” although “it does appear that the positive forces in the economy are starting to outweigh those that are negative.”


Growth in the global economy is expected to strengthen but with a weaker outlook than the Bank projected in January. The U.S. economy is also expected to regain momentum after a slow start in 2016. Inflation in Canada is evolving as anticipated. Taking into account all of these considerations, the Bank “judges that the overall balance of risks remains within the zone for which the current stance of monetary policy is appropriate.”


Great news if you’ve got a variable-rate mortgage, need a new mortgage, are renewing, or want to consolidate debt at the lowest cost funds. The next rate-setting day is May 25, 2016.

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Today’s Bank of Canada rate hold announcement marks almost four straight years that the key benchmark rate has remained unchanged, since September 8, 2010. Great news if you have a variable-rate mortgage or home equity line of credit; the prime rate stays at 3%.

 

The announcement noted that “the risks to the outlook for inflation remain roughly balanced, while the risks associated with household imbalances have not diminished.” With these considerations, the Bank is maintaining its monetary policy stimulus, and remains neutral with respect to the timing and direction of the next change.

 

The next rate-setting day is October 22nd.

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Data is deemed reliable but is not guaranteed accurate by the REALTORS® Association of Edmonton.