4 March 2014
As you know, this January the Bank of Canada said the risk of inflation decline had grown in importance, and the timing and right direction of the next rate change would depend on the new economic results. In addition to it, the Governor Stephen Poloz noted there could be a possibility of a rate cut.
Nevertheless, all hopes for a rate decline cracked after the latest inflation report was released, as in January the consumer price index was up by 1.5% on a year-over-year basis. It’s the largest result since June 2012. Meanwhile, the U.S. consumer price index rose by 1.6%, which is the strongest year-on-year growth in six months.
According to the survey, none of the primary dealers expects rate increase this year. Three of them predict hikes in the first quarter of 2015, another three – in the second quarter, and five are betting on the second half of the next year. And only one – Bank of America Merrill Lynch – expects no rate change in 2015.
Tune in tomorrow evening to our radio interview with Mortgage Broker, Michael Tulchenetskiy with detailed analysis of Bank of Canada decision. You can listen to the interview live, tomorrow, March 5th at 8pm on 1430AM.