20 July 2010

•    “The housing activity is decreasing rapidly, consistent with the Bank’s view…”
•    “Now the Bank expects the economy to recover at the end of 2011. It is two quarters later than it had been suggested earlier in April”.
•    “Both the core inflation and the total CPI are supposed to remain about 2% throughout 2011”.
The BoC says that even new 0.75% rate “leaves strong monetary stimulus in place”.
Now the mortgage industry is waiting for confirmation from the Big 5 banks that prime rate will rise by 0,25% as well. Usually, the banks announce the prime rate increases the same day as BoC rate hikes. The last time (on June 1), TD Bank was the first to react.
The 5-year yield fell to 2.31%. That’s why many were awaiting today’s announcement for a specific hint of rate direction. Now we may see 5-year fixed rates decrease in the near term.
The next BoC rate meeting is September 8.

Canada’s Key Lending Rate Hike
The Bank of Canada raised its key lending rate by 0,25%. Now it’s 0.75%.
The Bank announced it in the written statement:
•    “The global economic recovery is coming closer, but it’s not the end”.
•    “The housing activity is decreasing rapidly, consistent with the Bank’s view…”
•    “Now the Bank expects the economy to recover at the end of 2011. It is two quarters later than it had been suggested earlier in April”.
•    “Both the core inflation and the total CPI are supposed to remain about 2% throughout 2011”.
The BoC says that even new 0.75% rate “leaves strong monetary stimulus in place”.
Now the mortgage industry is waiting for confirmation from the Big 5 banks that prime rate will rise by 0,25% as well. Usually, the banks announce the prime rate increases the same day as BoC rate hikes. The last time (on June 1), TD Bank was the first to react.
The 5-year yield fell to 2.31%. That’s why many were awaiting today’s announcement for a specific hint of rate direction. Now we may see 5-year fixed rates decrease in the near term.
The next BoC rate meeting is September 8.

Canada’s Key Lending Rate Hike

The Bank of Canada raised its key lending rate by 0,25%. Now it’s 0.75%.

The Bank announced it in the written statement:

    * “The global economic recovery is coming closer, but it’s not the end”.
    * “The housing activity is decreasing rapidly, consistent with the Bank’s view…”
    * “Now the Bank expects the economy to recover at the end of 2011. It is two quarters later than it had been suggested earlier in April”.
    * “Both the core inflation and the total CPI are supposed to remain about 2% throughout 2011”.

The BoC says that even new 0.75% rate “leaves strong monetary stimulus in place”.

Now the mortgage industry is waiting for confirmation from the Big 5 banks that prime rate will rise by 0,25% as well. Usually, the banks announce the prime rate increases the same day as BoC rate hikes. The last time (on June 1), TD Bank was the first to react.

The 5-year yield fell to 2.31%. That’s why many were awaiting today’s announcement for a specific hint of rate direction. Now we may see 5-year fixed rates decrease in the near term.

The next BoC rate meeting is September 8.

 

Leave a Reply

Your email address will not be published.