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Mortgage Article
Interest rates - rising but still historically low
Source: Bank of Canada
According to Benjamin Tal, Senior Economist at CIBC World Markets, the Bank of
Canada is unlikely to raise rates much while the US federal funds rate stays near
zero. Doing so could result in premature slowing of our economy and an even
higher Canadian dollar. He therefore expects the first wave of rate hikes to be
limited, with most of the increase in 2011 when the Feb starts moving. Mr. Tal
expects the overnight rate to rise from the lowest level 0.25% to 1.25% by the end
of this year. By the end of 2011, the rate should still be an historically low 2.5 - 3%.
If the above forecast is accurate, it means that major banks’ Prime rate is going to
be 3.25% by this year and possibly 5% at end of 2011.
Interest rates - rising but still historically low
Source: Bank of Canada
According to Benjamin Tal, Senior Economist at CIBC World Markets, the Bank of
Canada is unlikely to raise rates much while the US federal funds rate stays near
zero. Doing so could result in premature slowing of our economy and an even
higher Canadian dollar. He therefore expects the first wave of rate hikes to be
limited, with most of the increase in 2011 when the Feb starts moving. Mr. Tal
expects the overnight rate to rise from the lowest level 0.25% to 1.25% by the end
of this year. By the end of 2011, the rate should still be an historically low 2.5 - 3%.
If the above forecast is accurate, it means that major banks’ Prime rate is going to
be 3.25% by this year and possibly 5% at end of 2011.
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Source: Bank of Canada
Updated on July 21, 10
Updated on July 21, 10