Today’s Bank of Canada (BoC) interest rate decision was reassuring for variable-rate borrowers.
· The Bank announced that Canada’s key lending rate will remain just 75 basis points above its all-time low.
· The Bank suggested its next move is just as likely to be a rate cut as a rate hike.
· It said the risk of falling inflation “has grown in importance” and that inflation won’t rise back to its target for “about two years” (suggesting even less chance of a prime rate increase through 2015).
Even if inflation does return to its 2% target, that alone isn’t enough reason for the Bank to raise rates.
So essentially, it’s Pleasantville right now for variable-rate borrowers, with no hikes in sight.
Source: www.canadianmortgagetrends.ca, written by Rob McLister