Bank Of Canada Holds Overnight Lending Rate

As expected, The Bank of Canada maintained their overnight rate in an announcement this morning.  This is great news as, as it keeps your prime mortgage or line of credit at 3.00%. In their statement, the BOC said that global economic recovery is becoming more firmly entrenched and is expected to continue at a steady pace.  Japan's significant losses from the disasters in March will severely affect its economic activity in the first half of this year and create short-term disruptions to supply chains in advanced economies. The instability in the Middle East may cause havoc over oil prices.   Despite the significant challenges that weigh on the global outlook, global financial conditions remain very stimulative and investors have become noticeably less risk averse.  The persistent strength of the Canadian dollar could create even greater headwinds for the Canadian economy, putting additional downward pressure on inflation through weaker-than-expected net exports and larger declines in import prices. The BOC expects the economic recovery in Canada to continue.   Although the prime rate will increase at some point this year. If you are on a variable rate, stay with it for now. Since 1992 the increases have only been by 0.25% at any one time. Therefore, any increase is expected to be gradual and controlled in line with economic recovery, both in Canada and globally. Fixed term rate increases this past week caused a bit of a stir amongst home buyers. As I said last week, fixed term increases at this time of the year are absolutely normal. They will come down again by the end of summer/beginning of fall as they do each year. The next announcement on any change to the prime rate is May 31st, 2011. Should you have any questions, or would like us to recommend a mortgage expert near you, please call me. Regards,

Asif

Asif Khan, Sales Representative
Re/Max Hall of Fame
Re/Max All-Stars Realty Inc., Brokerage

Posted via email from Markham Real Estate Today with Asif Khan