Categories for Bank of Canada

How to View the Bank of Canada’s More Sombre Tone

Canada’s rate-setter left its key rate untouched today while striking a less-than-cheery chord on the country’s outlook. Here’s a quick take on this morning’s Bank of Canada rate decision: Rate Announcement: No change Overnight rate: Remains at 1.75% Prime Rate: Remains at 3.95% (see Prime Rate) Market Rate Forecast: One rate cut in 2020 BoC’s Headline Quote: “…Governing Council will be watching closely to...

Bank of Canada Stands Pat

The Bank of Canada ended 2019 where it ended 2018, with prime rate frozen at 3.95%. Here’s a summary of the Bank of Canada rate decision this morning: Rate Announcement: No change Overnight rate: Remains at 1.75% Prime Rate: Remains at 3.95% (see Prime Rate) Market Rate Forecast: One rate cut in 2020 BoC’s Headline Quote: “Future interest rate decisions will be guided by…the...

Rate Outlook + Rate Nuggets

Canadian government bond yields, which lead fixed mortgage rates, are essentially adrift at sea. They, like so many other global yields, seem to just be biding time until positive (or negative) trade news breaks out of Washington. There’s so much uncertainty out there that it makes even less sense than usual to try and time the market. When President Trump...

Scotiabank Makes Case for Rate Cuts, Despite BoC Hesitation

Central banks around the world have been cutting rates. But, so far, the Bank of Canada has avoided joining that club. One of its worries is that lower interest rates would reignite the mortgage and housing markets, adding to Canadians’ already toppy debt loads. Deputy BoC Governor Carolyn Wilkins reiterated these concerns in a speech yesterday. “You’ve heard us say...

The Bank of Canada, Waiting For Its Cue

The Bank of Canada said today that it’ll keep coasting on rates. But the market isn’t so sure. Investors think our central bank may have to cut sooner than some expect. Here’s a summary of this morning’s decision: Rate Announcement: No change Overnight rate: Remains at 1.75% Prime Rate: Remains at 3.95% Market Rate Forecast: One rate cut in 2020 BoC’s Headline Quote:...

How Long Can the Bank of Canada Resist the Fed’s Rate Pull?

The U.S. Federal Reserve and Bank of Canada seldom make rate announcements on the same day, but tomorrow will be an interesting exception. No one expects any fireworks, but if you believe market expectations, the Fed will cut its key rate 1/4 point while the BoC does a whole lot of nothing. If it all plays out accordingly, it’ll be...

Fed Cuts. Canadian Rates Barely Move

Canadian mortgage rates follow U.S. rates like spring follows winter. So today’s U.S. Federal Reserve rate cut is most relevant indeed. The Fed chopped the floor for its key target rate by 25 bps today to 1.75%—the same as the Bank of Canada. It’s the second cut in 49 days, but only the second cut since 2008. As usual, the...

The Bank of Canada Won’t Gamble on a Rate Cut…Yet

Markets predicted the Bank of Canada would do nothing to rates for the 11th straight month…and they were right. Here’s a quick look at the BoC’s rate statement: Rate Decision: No change Overnight rate: Remains at 1.75% Prime Rate: Remains at 3.95% Market Rate Forecast: No change to prime through 2020 BoC’s Headline Quote: “…Canada’s economy is operating close to potential and inflation...

What the Fed Rate Cut Decision Means for Canadian Mortgages

Canadian mortgage rates take their cues from many things, and U.S. monetary policy is near the top of the list. That’s why today’s Fed rate cut—the first since the financial crisis—is meaningful to borrowers. Fed decisions always move Canadian rates in some respect but in this case, key questions remain. Here are the two biggest ones. How Many Cuts Are...

Fed Rate Cut on Deck

If market expectations are on the money, the U.S. Federal Reserve will drop its key policy rate on Wednesday — for the first time in over a decade. Unlike most cuts, however, this one’s arguably not as urgent. It’s more akin to preventative medicine that wards off (economic) illness before the symptoms get severe. Here’s a quick read on how...