The Bank of Canada decided to keep the lending rate the same. This means that Prime should stay at 3%. So, people with Variable Rate mortgages, line of credits, loans based up Prime and some credit card holders will be happy to hear this.
You may have heard inflation increased quite significantly this last quarter. This normally would cause the bank to increase the rate however other significant national and global economic data outweighed the risk of inflation. Strong dollar and low exports particularly caused concern.
The Bank stated that keeping its key rate steady “leaves considerable money stimulus in place, consistent with achieving the 2 per cent inflation target in an environment of significant excess supply in Canada,” and that any further increases “would need to be carefully considered.”
Earlier this year, the Bank had raised its key interest rate three times since June, but it also kept borrowing costs steady on October 19, noting some uncertainties in the economic outlook and continuing weakness in the U.S. economy.
The good news is that it is still a good time to refinance or get a rate hold until you find the perfect home. Fixed rate have increased but are still below 4% for five year term. The 5 yr Variable rate is Prime less .70%.
Don’t forget to do an Annual Mortgage Check up. Make sure you are on track to being mortgage free.
Questions? Call me anytime.