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  • Writer's pictureSteven Himelfarb

Bank Of Canada Doubles Down - Important Market Update

We knew this was coming.

For a while now, the stimulus in place, which was keeping rates at record-lows, was bound to go in the other direction. It has begun. With the stimulus being removed over time, it is being done in part to combat current record-high inflation. When inflation goes up, interest rates are typically increased. Will this be an effective measure? Time will tell. We have seen all lenders steadily raise their rates to reflect BOC overnight rate and this will continue over time. With bond values up, fixed rates are also creeping up to record highs eclipsing 4% and are aiming for even higher.

Bank of Canada just increased their overnight rate today to 1.0% by increasing it another 0.50%. This is the biggest increase in over 2 decades and the 2nd rate increase this year, with likely more to come before 2023 is over.

This is still considered low. These rates are just coming back to what was normal a decade ago and for many years prior. (It was 1.75% pre-pandemic)

Remember, people dont buy rates, they buy monthly payments. Given your situation, it is important to speak to your broker and learn what you can do and should given your goals, both short-term and long term, and what options are available to you.

If you have questions, want to improve your position, or are curious about all things mortgage, just give me a call.

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