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TagBank of Canada

Posted Interest rates

Bank of Canada takes a pause with rate hikes

Bank of Canada governor, Mark Carney, held the Target Rate steady today…as expected…  Concerns about the U.S. economic recovery stalling, the Global economy and our own domestic economy were mentioned in the Press Release.

In the press release, the Bank said inflation was not a concern as it is under the 2% target.  Take all this data and it spells UNCERTAINTY.

What’s also interesting is that the Bank has adjusted it’s forecast for growth downward for the next 2 years…Great news for those in a Variable rate… Variable rates are hovering around 2.30% these days.

This makes the Variable Rate product that much more attractive…even with 5 year fixed rates in the 3.59% range.

Experts believe the rate will remain steady throughout next Spring and possibly into Fall depending on inflation and Global and domestic economic data….

Click here for the Press Release.

Posted Interest rates

More speculation that interest rates will remain low

We’re starting to see more evidence that the recovery is not going as well as the Bank of Canada first thought.   Inflation has dipped slightly, even with the HST.

CIBC Chief Economist, Avery Shenfeld, says we are beyond the ‘Great Depression of 2008-09 but we are in the ‘Great Disappointment’ of  a sub-par recovery.   He’s forecasting for interest rates to remain flat until the spring of next year, followed by only gradual increases thereafter.

Great news for anyone that has a mortgage…

Posted Mortgage Rates

Variable Rate is up 0.25%

Bank of Canada raised their Target Rate by 0.25% to 1.00%.   We will see the Retail Bank’s Prime lending rate go up from 2.75% to 3.00%.

Governor, Mark Carney, said “Any further reduction in monetary stimulus would need to be carefully considered in light of the unusual uncertainty surrounding the outlook,” .    This is sounding like we won’t see any further hikes til some time next year as the Government evaluates the economy and the global markets.

I still like Variable rate… at 2.30% to 2.50%, this is still much better than the 5 year fixed rate of 3.75%, which is what we are seeing today.

Posted Mortgage News

School’s in for Bank of Canada

To all the kids…. including my son…..”Have a great year at school.. make it fun… make it count”.

Tomorrow is the 6th of 8 scheduled meetings for 2010 by the Bank of Canada…a time when they set the Target Rate or Overnight Rate, which directly affects the Bank Prime Rate and your Variable Rate Mortgage.

The original plan called for Mark Carney, Governor of Bank of Canada, to raise interest rates steadily over the next year or so by as much as 3.00%… but it’s become a little tougher to make that move.

Less than impressive economic news in the U.S., Canada and the rest of the world has given concern about a double dip recession…. raising the rates during a period of uncertainty is risky business.   Right now, experts are calling for a 60% chance of a rate hike but then a pause to see how this will affect the economy.

Longer term forecasts have been amended for more modest rate hikes in 2011….  all good news for Borrowers…  stay tuned as we continue to monitor the latest reports…

Bottom line, new Variable rate mortgages can be had for around 2.05% to 2.10%… so even a 1.50% increase would  beat out a 5 year fixed rate….

Posted Consumer Debt

Bank of Canada rate up by 0.25% and personal debt levels down.

BANK OF CANADA RATE UP

July 20th, 2010….an interesting day.  This was the 5th of 8 scheduled Key Interest Rate announcements… No real surprises… the Key rate went up by 0.25%…. the second increase this year…

The new Bank Prime rate is now 2.75%.    Variable rate borrowers will see a 0.25% increase in their mortgage rate… but don’t feel too bad… your mortgage is probably just over 2.00%….. that’s much lower than even the lowest 5 year fixed rate mortgage of 3.69% which was being offered mid last year….and recent reports are calling for a very slow and gradual interest rate hike…click here for the latest.

PERSONAL DEBT LEVEL DOWN

Remember the reports about the high personal debt levels that Canadians had?  We were spending like fools… according to many “Experts”… And bank on May 13, I questioned these reports….

Now we are seeing that Canadian Personal Debt levels are down….Come on… we didn’t change overnight.. we  have just been taking advantage of these record low rates to invest or spend wisely…and what’s wrong with that?..  see the latest stats…