The Bank of Canada keeps the overnight interest rate unchanged at 0.25%. The retail prime rate will stay at 2.45% (2.60% at TD bank). For the latest rates, check out our rates page here.
Key points from the Bank of Canada March 2021 announcement:
- The Bank of Canada maintained the overnight lending rate at 0.25%, which means no change to the retail prime rate of 2.45% (2.60% TD).
- BoC underlines its 2023 projected timeline before they think rates might change.
- Inflation remains below the 2% target, the BoC doesn’t see inflation as a major risk
- Despite some better than expected economic growth numbers, the BoC restates its commitment to support the Canadian economy recovery via its quantitative easing (QE) program & maintaining the policy rate at its current level.
Bank of Canada underlines its 2023 rate commitment
Despite the recent rise of fixed rates caused by better than expected economic data, the Bank of Canada has decided to make no changes to the overnight lending rate leaving it at 0.25%.
The BoC remains very cautious about the recovery of the Canadian economy. There remains considerable uncertainty about the path of the pandemic and how it might delay our longer-term recovery.
You can read the Bank of Canada’s full press release here.
What does today’s decision mean for you?
If you currently have a variable rate mortgage or secured line of credit, you’ll see no changes to your monthly payments. The retail bank prime rate will remain at 2.45% (2.60% TD bank).
Should you convert your variable rate mortgage? Despite a recent rise to fixed-rate mortgages, I don’t see a good case to rush into a fixed mortgage at the moment. Keep in mind switching from a variable to fixed at the moment would result in a 0.50% to 0.75% increase to your rate overnight.
For more information about mortgage financing and to discuss any specific requests, please contact me here or book a call directly into my calendar here below.
