19 Sep Canada’s Rising Interest Rates
Canada’s Rising Interest Rates
Canada’s rising interest rates come after a prolonged period of extremely low rates. According to an article on The Financial Post;
“Dana Peterson, Citi Research
The BoC hiked today catching markets off guard, once again … The stronger-than-expected Canadian economic performance largely influenced the decision to hike.
The Bank cautioned that while the “removal of some of the considerable monetary policy stimulus in place [was] warranted,” policy is not on a predetermined course. Nonetheless, we believe the action sends a powerful signal to markets that the Bank is likely initiating a tightening cycle, not simply engaging in oil shock “insurance” removal.
We must reassess our interest rate forecast path, but assume that an October hike is possible if the favorable conditions that supported the last two hikes persist and downside risks are not realized. Fed policy decisions will also factor into the Canadian rates path.” Real the full article here: http://business.financialpost.com/news/economy/three-rate-hikes-this-year-economists-ramp-up-tightening-forecasts-after-bank-of-canada-statement
The Bank of Canada raised its key interest rate by another quarter of a percentage point, up to 1 per cent from 0.75 per cent, on Wednesday. The decision, which follows a first hike in July, could be just the second in a string of rate increases to come, some economists predicted in light of the announcement.
On September 6th 2017, the Bank of Canada increased their lending rate by 0.25%, from 0.75% to 1%. This increase means the Canadian banks and financial institutions will increase their prime rate, and this means…higher lending rates on mortgages, line of credits, and student debt.
Canada’s Rising Interest Rates And The Outlook For 2018:
The Conference Board of Canada’s Craig Alexander discusses the rate hike and why there may not be another increase this year.