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Posted 4 Comments on A Broken Promise Leads To A Broken Economy Bank News

A Broken Promise Leads To A Broken Economy

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.

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Posted 2 Comments on The 3 Questions I Get Asked Most About Rising Rates Bank News

The 3 Questions I Get Asked Most About Rising Rates

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? 

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Posted 1 Comment on Variable Rates Go Up, Fixed Rates Come Down Bank News

Variable Rates Go Up, Fixed Rates Come Down

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.

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Posted Bank News

Death, Taxes, and Interest Payments: Part 2

There are some things in life you can’t avoid, but only two things you can’t avoid paying for: taxes and interest payments. In Part 1 of this series, we looked at owning a rental property as a great way to build your net worth while reducing your taxes. Now, in Part 2, we’ll be turning to interest payments. 

Interest payments are a pain to deal with but a necessary evil nonetheless. Here are a few ways to make them a little less painful. 

Continue reading “Death, Taxes, and Interest Payments: Part 2”
Posted 2 Comments on Rates Are On the Up and Up… But For How Much Longer? Bank News

Rates Are On the Up and Up… But For How Much Longer?

You’ve probably seen the headlines: the Bank of Canada has raised their key interest rate. Yet again. And this hike isn’t any less forgiving than the last one. In another unprecedented move (anyone sick of that word yet?) the rate increased by 0.50%, double the normal increase of 0.25%. Yes, it’s a big jump that’s getting a lot of media buzz. But how bad is it really? Is it worth all the alarm? Will rates continue to climb?

Continue reading “Rates Are On the Up and Up… But For How Much Longer?”