Bank of Canada Announcement
May 29, 2019 | Posted by: Holly Cochrane
If you have a variable rate mortgage, line of credit and/or student loan, today’s announcement from the Bank of Canada to maintain their overnight rate is good news for you. In most cases, changes to the Overnight rate impacts your prime rate and maintaining this rate should mean no changes to your current repayments.
In a statement released by the Bank of Canada, they say their decision is based on recent economic data and global trade risk:
“Recent Canadian economic data are in line with the projections in the Bank’s April Monetary Policy Report, with accumulating evidence that the slowdown in late 2018 and early 2019 is being followed by a pickup starting in the second quarter. The oil sector is beginning to recover as production increases and prices remain above recent lows. Meanwhile, housing market indicators point to a more stable national market, albeit with continued weakness in some regions. The global economy is also evolving largely as expected since April, although the recent escalation of trade conflicts is heightening uncertainty about economic prospects. In addition, trade restrictions introduced by China are having direct effects on Canadian exports.”
Holly Cochrane from the Holly Cochrane Mortgage Team explains “Fixed term interest rates have decreased slightly. Don’t forget that if you want to lock in, you can take a shorter term that will typically have a lower rate attached to it. Converting to a fixed rate isn’t right for everyone as other factors need to be taken into consideration, such as income, payment changes and future plans, and discussing this with my team will help you make an informed decision.”
With the spring market now in full swing plus today’s announcement, now might be the time to start thinking about your options. Getting expert advice is the first step, so contact the Holly Cochrane Mortgage Team on 780-485-7908 to discuss what is suitable for you and your situation. The next announcement from the Bank of Canada will be July 10, 2019.