Tuesday, April 22, 2008

Interest Rates Bank of Canada cuts 50 points

Bank of Canada Slashes Interest Rate Again!
This could be the final cut for some time to come as the Bank of Canada cuts another 50 points off the key rate
In a widely expected move, the Bank of Canada cut its key interest rate by 50 basis points, or half a percentage point, on Tuesday। The cut brings the key rate to just 3 per cent.

The latest reduction brings the number of consecutive cuts to four since last summer, totalling 150 basis points, as the central bank attempts to deliver some stimulus to the slowing economy।
Inflation, however, does not appear to be a big concern thanks largely to the offsetting impact of the strong Canadian dollar. In the latest report from Statistics Canada, year-over-year inflation as measure by the consumer price index rose just 1.4 per cent in March, well within the central bank's target. The bank believe inflation will rise to about 2 per cent by 2010

In its accompanying statement, the Bank of Canada noted that the economic slowdown in the United States is expected to be deeper and more protracted, causing the Canadian economy to expand at a 1.4 per cent pace.


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  1. Mark, I have Scotia Bank Flex variable rate mortgage with 0.5% under prime, right now with prime being 5.25% , my mortgage interest is 4.75%, after another 0.5% cut by Bank of Canada, do u think it's a good idea for me to try to fix the rate? if so what do u think would be a good rate for 5 years assuming i have good credit

  2. Since I am working as a Vancouver realtor I really hope that lower rates will encourage people again to deal with real estate. I’ve read also some research between economist and it is widely expected that Bank of Canada will lower rates one more time. I think it could be possible thanks to very low level of inflation and quite strong dollar now. Hope lowering overnight rates will not be accompanied with rising inflation in the future.