Interest rates are 200 bps higher than they should be due to government spending: Scotiabank
Canadian interest rate are about 200 basis points higher than it otherwise would be due to government spending at all levels, including billions spent on pandemic relief.
That’s the assessment from a new Scotiabank report that set out to put an exact figure on the impact government spending has contributed to higher interest rates.
“We could see rates stay higher for longer,” Bank of Canada says :
Canadians must prepare for the possibility that interest rates remain “higher for longer,” the Bank of Canada’s Senior Deputy Governor said today.
While speaking in Vancouver Thursday morning, Senior Deputy Governor Carolyn Rogers outlined some of the reasons why “we could see rates stay higher for longer and why it’s important to adjust proactively to that possibility.”
“Globally, the adjustment to higher interest rates is well...
As tougher lending requirements have more homeowners turning to the private mortgage market, brokers say having a strategy to eventually get out of the loan is crucial, or they risk falling into a debt trap that could eventually lead to a For Sale sign on the front lawn.
“Getting out is very difficult. And if you don’t plan for it, or at least acknowledge the difficulties and make that part of your risk determination, you can end up just paying money for the rest of...
Weak GDP data means Bank of Canada rate hikes could be “over and done”
Canada’s economy slowed more than expected in the second quarter, raising the likelihood that the Bank of Canada will leave rates unchanged at next week’s policy meeting.
Statistics Canada reportedthat real GDP dipped 0.2% in the second quarter, against estimates for a 1.2% rise. That’s also well below the Bank of Canada’s official GDP forecast for 1.5% growth in both Q2 and Q3.
“The small pullback in Q2 GDP lines up well with the recent rise...