No Change to Prime
The Bank of Canada is opting to hold off on further interest rate increases, at least for now.
While the Bank projected a temporary slowdown at the end of 2018 and into 2019, the slowdown has been much more pronounced than anticipated. According to the Bank, this is because–in addition to the fallout from last year’s drop in oil prices–Canada is also suffering from softer consumer spending, an under performing housing market, and lower-than-expected exports and business investment.
We’re not alone. Countries across the world are dealing with trade tensions, low economic confidence and slow economic activity. As a result, many central banks–including the Bank of Canada–are being forced to acknowledge that global economic growth and financial conditions are a little slower than previously predicted, and the future remains a little uncertain at the moment.
All that being said, core inflation measures remain close to the Bank’s 2% target, while CPI inflation eased to 1.4 per cent in January, but is expected to increase to slightly below the 2% target through most of 2019. With inflation in check, the Bank judges that, for now, the policy interest rate should stay below the neutral range. It will continue to monitor the data to determine the timing of future rate increases.
My advice is to stay with your current existing variable rate mortgage. However, if your existing variable rate discount is Prime less .75% or less, then please contact me for further discussions.
The date for the Bank of Canada’s next announcement is scheduled for April 24 2019.
This information was provided by one of our Preferred Suppliers – The Mortgage Doctor
To Contact Bob visit www.mortgagedoctors.ca