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Why didn't the Bank of Canada Gov cut rates last week

Why didn’t the Bank of Canada Gov cut rates last week?

Why didn't the Bank of Canada Gov cut rates last week

WAS THIS A BIG MISTAKE?

Last week, Stephen Poloz, the Bank of Canada Governor, kept the Prime Rate as is during the 6th of their eight scheduled meetings for 2019.  The Current Target rate is 1.75%.  (Bank Prime rate is derived from this rate.  Today’s Bank Prime rate is 3.95%.  Over 99% of time, when the Target Rate is cut, the Banks will reduce the Bank Prime Rate by an equal amount).

This was a very calculated decision that has politics written all over it.  While the rest of the world banks have been cutting rates to combat a looming recession due to growing global trade wars and slowing global economies, our Government did nothing.  Apparently, the Canadian economy is ‘resilient’.  The next Bank of Canada meeting is set for October 30, 2019.  Oh, and there’s a Federal election on Oct 21, 2019.  Yeah, this has politics written all over it.

WHAT YOU SHOULD KNOW ABOUT MORTGAGE RATES TODAY.  Continue reading “Why didn’t the Bank of Canada Gov cut rates last week?”

Mortgage Rates have Dropped and Will Fall Further

Mortgage shopping

Rate forecasting isn’t rocket science – it’s more common sense than you think! But, it requires a clear mind to make sense of all the rubbish that’s being published these days.

I’ve been forecasting for a while now that interest rates would start to come back down this year. Currently, interest rates are down by around 0.4% and will come down further.

WHY ARE RATES FALLING?  Continue reading “Mortgage Rates have Dropped and Will Fall Further”

Mortgage growth has slowed… so why are BANKS winning & CONSUMERS losing?

Blog Image, Feb 12, 2018

I reviewed some recent stats that explain how overall mortgage growth has fallen to its lowest level in the past 17 years!

Overall, mortgages outstanding across Canada total more than $1.5 trillion. And, while this total continues to increase year over year, the rate of growth has decreased. We should pay attention to this!

Typically, when we experience lower mortgage growth or no growth at all, house prices will follow suit and come down.

But, why aren’t the banks up in arms over this given that they make huge profits by lending money? (More on this below.)

Continue reading “Mortgage growth has slowed… so why are BANKS winning & CONSUMERS losing?”

Remember when I said rates could go down, not up?!

saving money-young woman putting a coin into a money-box-close up

If you’re a regular reader of this site, you’ll know I’ve been very skeptical and critical of the Bank of Canada (BoC) for continuing to increase interest rates. It just hasn’t made sense.

The BoC raised rates FIVE TIMES between July 2017 and October 2018. That’s a 1.25% increase. For anyone with a $300,000 mortgage, your payment increased by $189 per month. Or, to put it another way, for every $100,000 of mortgage, your payment went up by around $63 per month.

Yet, we kept hearing that the BoC wanted to raise rates further. Economists and other experts were saying we should expect more rate increases by the end of 2018! Wow!

Continue reading “Remember when I said rates could go down, not up?!”

What’s the TRUE Impact of Policy Changes on the Canadian Mortgage Market?

Boc Mortgage Rule Impacts, Dec 2018

It’s certainly not what the Bank of Canada (BoC) is claiming!

The BoC recently released a document detailing what it believes to be a positive report on the Canadian Mortgage Market, but this article clearly shows how out of touch our government is.

The BoC is applauding their statistics… yet, these numbers show that the government appears to be measuring affordability as a multiple of one’s income – and not by the proven, standard method of debt servicing ratios. This is very odd and, quite frankly, I find it absurd.

Continue reading “What’s the TRUE Impact of Policy Changes on the Canadian Mortgage Market?”

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