The Bank of Canada has always avoided forecasting rate hikes and rate cuts. It’s always been a closely guarded secret left to speculation – that is, of course, until July 2020. In what might have been the first announcement of its kind in the history of the BoC, Governor Tiff Macklem publicly stated that “interest rates are low and will stay low for a long time.”
The central bank didn’t anticipate having to raise rates until 2023 and for some reason made a choice to communicate that to Canadians. Naturally, Canadians made financial decisions accordingly. Big financial decisions. All on the basis of a promise made by a government institution they knew and trusted.
As we’re now learning, that promise was impossible to keep.
Continue reading “A Broken Promise Leads To A Broken Economy”
It’s no secret to anyone reading this: rate hikes have gone off the rails. On September 7th, the Bank of Canada announced yet another whopping increase of 0.75% leaving economists scratching their heads. Typically rates increase or decrease by 0.25%, if they change at all. Inflation has forced the BoC to make some pretty drastic decisions… but have they gone too far?
Continue reading “The 3 Questions I Get Asked Most About Rising Rates”
For millions of Canadians, the Bank of Canada meetings are a major cause of anxiety. Will rates go up? By how much? Will I continue to be able to meet my monthly mortgage payments? It’s only natural to ask these questions. Recent hikes have been dramatic to say the least. And to make matters worse, the media has a way of making everyone feel like these hikes are in a perpetual uphill climb.
But in my opinion, a plateau is coming sooner than expected.
Continue reading “When Will Variable Rates Stop Climbing?”
If you’re reading this, you probably know by now: the Bank of Canada has been raising their benchmark rate aggressively to battle inflation. And I mean aggressively. Their rate has gone up by 2.25% in 6 months which is absolutely – wait for it – unprecedented.
As a result, variable rates have shot up. Everyone expected fixed rates to follow suit – but interestingly enough, the opposite has happened. They’ve actually gone down. Yup, you read that right: while variable rates are going up, fixed rates are going down.
Continue reading “Variable Rates Go Up, Fixed Rates Come Down”
Yesterday, the Bank of Canada raised their rate by a whopping 1%. It’s the biggest rate hike in a long time, and it’s got a lot of people talking. Mostly negatively (surprise surprise) but I for one have no interest in talking about what you can’t control. Instead, I want to talk about what you can control. There’s a way you can capitalize on a rare opportunity to grow your net worth over time, and it runs contrary to everything you’re hearing on the news:
Buy real estate.
Continue reading “The Right Time To Buy Is Right Now”