This morning, the Bank of Canada (BoC) raised its policy rate another .25% bringing its benchmark interest rate to 1.5%, to keep a lid on inflation, while acknowledging future hikes will be gradual because of the recent trade upheaval. This is the fourth time the central bank has raised its rate since last summer.
Payments linked to Prime on variable-rate mortgages and lines of credit are likely to rise immediately.
With inflation already above the central bank’s 2% target and potentially heading higher, Bank of Canada Governor Stephen Poloz wants to keep wage and price pressures in check. Recent data also suggests housing markets are beginning to stabilize following a weak start to 2018.
If you have questions about how this change will impact you and your mortgage, please contact me to review your personal situation.