Bank of Canada Announcement | September 7th, 2022
The Bank of Canada met on September 7th, 2022 and announced an increase of 75 basis points to Bank Prime bringing it up to 5.45%.
Bank of Canada Announcement Recap
The Bank of Canada met on September 7th, 2022 and increased rates by 0.75%. This now puts Bank Prime at 5.45%.
Rates will most likely need to rise further and we will ultimately see them stay at these elevated levels until the economy slows and inflation comes back down.
The Bank of Canada is no longer using the word "soft landing" in their announcement and its becoming increasingly likely a mild recession could be on the table for late 2023 and into 2024.
If the Bank of Canada had to pick between high inflation or creating a recession, at this point, a recession is easier for them to control through monetary policy (ie. they can re-stimulate the economy by dropping rates slightly).
My personal strategy is variable and I'm sticking wih it.
What this means for you
Variable Rate Clients - The same strategy still exists. If you were to lock in today, it would be at a higher rate in the range of 5.29%-5.49%
Clients out House Hunting - The rate hold still exists but the mortgage amount you qualify for will be now reduced. We will be reaching out to all of our preapproved clients but please also send us an email if you’re currently out house hunting.
Should you have any questions or simply want to chat through your options, don't hesitate to reach out.