The Bank of Canada will hold its rates for the time being – overnight rate at the effective lower bound of ¼ percent, with the Bank Rate at ½ percent and the deposit rate at ¼ percent.
A few highlights from today’s announcement:
- Canada’s economy grew by about 5½ percent in the third quarter, as expected. Growth was led by a rebound in consumption, particularly services, as restrictions were further eased and higher vaccination rates improved confidence.
- Persistent supply bottlenecks continued to inhibit growth in other components of GDP, including non-commodity exports and business investment.
- Broad-based job gains in recent months that have brought the employment rate essentially back to its pre-pandemic level.
- Housing activity had been moderating, but appears to be regaining strength, notably in resales.
- The devastating floods in British Columbia and uncertainties arising from the Omicron variant could weigh on growth by compounding supply chain disruptions and reducing demand for some services.
- The Bank continues to expect CPI inflation to remain elevated in the first half of 2022 and ease back towards 2 percent in the second half of the year. The Bank is closely watching inflation expectations and labour costs to ensure that the forces pushing up prices do not become embedded in ongoing inflation.
This announcement means that mortgage rates are still very competitive. Again, I encourage you to look at consolidating debt, applying for a mortgage, or looking at your mortgage renewal so you can get the best rate locked in.