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Once again, no rate change!

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As expected, the Bank of Canada announced yesterday that it is not changing the benchmark rate.

 

The announcement noted that with “inflation expected to be well below target for some time, the downside risks to inflation remain important.”

 

Great news if you’ve got a variable-rate mortgage; the prime rate stays at 3% and it’s unlikely we’ll see any increases in the near future.

 

The next rate-setting day is April 16. Eight times a year, the Bank of Canada sets the rate that governs each lender’s prime rate. Variable-rate mortgages and lines of credit move in conjunction with the prime lending rate. Fixed rates on the other hand are based on the bond market.

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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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