The Bank of Canada announced today that it has reduced its overnight rate by a quarter of a percent. Therefore the Prime lending rate has been reduced to 2.65%. At this time only one lender has announced that they are also dropping their Variable rates but only by 10 basis points and not the full 25 basis point drop indicated by the Bank of Canada. Typically other lenders will follow.
Total CPI inflation reflects price declines for consumer energy products. The Bank’s estimate of growth in Canada for 2015 has been marked down considerable from it’s prior expectations. However, growth is expected to resume in the 3rd and 4th quarters.
With all that being said, both variable and fixed rate mortgages are still at record lows. If you’re in the market for a new mortgage-or if you have a question about your existing one-please don’t hesitate to reach out.
With the Prime rate falling, we are continuing to recommend that clients stay in their existing variable rate mortgages. The date of the Bank of Canada’s next announcement is scheduled for September 9 2015