Yesterday’s rate cut announcement by the Bank of Canada (BOC) governor, Stephen Poloz, caught all Economists by surprise. The BOC cut their overnight rate by 0.25%. Historically, and traditionally, this meant that the Bank Prime rate would follow. Bank Prime rate is 3.00% and we expect it to fall to 2.75%.
But HOLD ON!…Today, it’s the BOC governor, Poloz, that will be surprised as TD Bank says they WON’T be cutting their Bank Prime rate! The BOC cut the rate to help stimulate the economy. Businesses borrow commercial funds priced against Bank Prime… and consumers borrow lines of credit and Variable rate mortgages against Bank Prime. Continue reading “TD green or TD GREED?!. as they refuse to lower the Prime rate!!”
FEAR..! They say fear motivates us to do things we shouldn’t. If you’ve been reading the News Headlines for the past several weeks, you’ve been hammered with RATE HIKE FEARS! Everyone was saying rates were gonna go up.
It wasn’t just speculation, it was a foregone conclusion. Almost factual! There were headlines even reporting how much of an impact these new ‘higher rates’ would affect our lives, our budgets, our house values, our savings, etc. We saw so-called ‘Experts’ recommending we lock into long term Fixed rates! There was one articles telling us we should consider selling out homes! I mean if you didn’t know better, you would think the sky was falling!
Panic was starting to set in for thousands of Canadians. I was getting calls from concerned consumers asking if they should be doing anything with regards to their mortgage, their investments, and other personal finances. Continue reading “Bank of Canada Rate cut is positive news… don’t listen to fear mongers.”
Last week, I made a bold statement about interest rates. I said rates will remain low for some time. And they could even decline.
That forecast was met with a certain degree of criticism. Well, no surprise for CanadaMortgageNews.ca followers, the Bank of Canada cut the rate by 0.25% to 0.75%.
This means Variable Mortgage rates will fall by 0.25%. It also means we’ll probably see fixed rate mortgages also fall….. As I predicted.
Stay tuned for more details on this…
Your best interest is my only interest. I reply to all questions and I welcome your comments. Like this article? Share with a friend.
Steve Garganis 416 224 0114 email@example.com
Here we go again… The beginning of a new year, and the same annual forecasts for interest rates to go up! Before I share my thoughts.. Here’s some of the recent headlines that I’ve seen….
- a report by CBC News sharing 4 ways to prepare.. including selling your home, waiting to buy and locking into a Fixed rate mortgage! (Can you say panic?)
- Here’s another from The Globe and Mail telling us it’s “Bad News for Borrowers: The economy could improve this year”. Really? Tell that to the people in Alberta, Newfoundland and Saskatchewan.
- And this one from last week says Get ready for Interest Rate Shock in 2015.
Wow, reading this means rates are certain to up this year…right? So let’s see.. we should sell our home, put off buying (yet again) and lock in our Variable rates into Fixed rate mortgages..
Now let’s look at the most recent headlines.. Continue reading “So, you think rates are gonna spike up this year? Who says?”
In her first public speech as Senior Deputy Governor for the Bank of Canada, Carolyn Wilkins brought some good news to Canadians with mortgages. Interest rates should remain low for some time….. and we can expect lower rates to be the “new normal”.
Ms. Wilkins went on to say that “the recovery has had repeated false starts and still faces considerable headwinds.” This seems to be the new message coming from the Bank of Canada. And I must say, it’s a refreshing change from the previous high-profile Governor, Mark Carney.
Remember our previous Bank of Canada governor? Mr. Carney earned high praise for helping Canada avoid any U.S. style recession. But in the years leading up to his 2013 departure, his repeated warnings of pending interest rate hikes never materialized. In fact, we now know they were way off. Interest rates went down and have stayed down. Looking back, Carney’s rate hike warnings sounded more like ‘the boy who cried wolf’. Continue reading “Senior Deputy Governor says lower rates are the new normal.”