Are we finally near the end of the interest Rate hikes?
The Bank of Canada is set to make their last interest rate announcement of the year on Wednesday, December 7th at 10:00 AM Eastern Time. Economists are predicting another interest rate hike of 25 to 50 basis points, which would bring the key interest rate to 4.00% or 4.25%. Even with the smaller hike of 25 basis points, it would bring the interest rate to the highest it’s been since 2008. Some believe this will be the last interest rate hike for the Bank of Canada in the near term.
The Bank of Canada’s current interest rate is 3.75%. The current prime rate, also known as the prime lending rate, is 5.95%.
What does this mean for mortgage rates in Canada?
According to our December Mortgage Rate Outlook, Ali Hussin, Head of Mortgage Advisory at Perch, predicts fixed Mortgage Rates will continue to drop, with variable mortgage rates expected to increase slightly.
The Canadian Real Estate Association (CREA) reported national home sales were up 1.3% on a month-over-month basis in October 2022. Meanwhile, the number of newly listed properties edged up 2.2% month-over-month. Historically, November and December see lower inventory and less motivated buyers as the holiday season rolls in. For home buyers who are actively viewing properties, expect there to be less competition with limited new listings to check out.
What should I do as a homeowner due for a mortgage renewal?
For homeowners who are coming up for a mortgage renewal, continue to monitor our Canada interest rate forecast. Given today’s mortgage market, we recommend renewing into a shorter term, until mortgage rates begin to decrease in the coming year.
What are today’s best mortgage rates?
The best 5-year fixed rate is 4.79%. The best 5-year variable rate is 4.80%. Additional mortgage rates and terms can be found here.
Why has the Bank of Canada increased the interest rate so much in 2022?
With a red hot economy and rapidly rising inflation, increasing the interest rate is one of the main levers the Bank of Canada has to slow consumer spending. As per Tiff Macklem, Governor of the Bank of Canada: “The Bank of Canada’s job is to ensure inflation is low, stable and predictable. […] We are still far from that goal. We view the risks around our forecast for inflation to be reasonably balanced. But with inflation so far above our target, we are particularly concerned about the upside risks.”
When is the next Bank of Canada rate announcement?
The next Bank of Canada interest rate announcement is Wednesday, December 7th at 10:00 AM Eastern Time. After that, the next announcement is set for Wednesday, January 25th, 2023.
What is the Bank of Canada rate announcement schedule for 2023?
The Bank of Canada released its schedule for interest rate announcements in July 2022. The 2023 schedule kicks off in January:
- Wednesday, January 25, 2023
- Wednesday, March 8, 2023
- Wednesday, April 12, 2023
- Wednesday, June 7, 2023
- Wednesday, July 12, 2023
- Wednesday, September 6, 2023
- Wednesday, October 25, 2023
- Wednesday, December 6, 2023
This post first appeared on Mortgage Resources For Canadian Home Buyers And Homeowners, please read the originial post: here
