Bank of Canada (BoC) announced on last Wednesday that it would continue to hold its target for the overnight rate at 0.25% to help households and businesses recover from the COVID-19 Pandemic. It is interesting to note that the new BoC Governor, Tiff Macklem has given great certainty in when to increase the rate via a very specific measure. He made it clear that the overnight rate will not go up until inflation reaches 2%, which, he predicted would probably take a minimum of two years, assuming that we do not experience a second wave of COVID-19 in Canada.
The recent extraordinary efforts made by BoC have included aggressive rate cuts and large-scale asset purchases. As a result, our lenders have sufficient and low cost funds to lend and we are all surprisingly busy and pleased in securing low cost solutions for our customers.
