Mortgage Rates Are Going Down

The Bank of Canada once again lowered its key interest rate to 4.25% to help with economic challenges and support homeowners and buyers. The prime lending rate is now 6.45%. This decision comes as inflation slows down and ongoing excess supply in the economy.

Looking ahead, the Bank expects the economy to grow, borrowing costs to drop, and the housing market to strengthen. Inflation is also expected to move closer to the 2% target over time. The Bank will keep an eye on the economy and adjust as needed.

In today’s announcement, the Bank said, “With continued easing in broad inflationary pressures, Governing Council decided to reduce the policy interest rate by a further 25 basis points. Excess supply in the economy continues to put downward pressure on inflation, while price increases in shelter and some other services are holding inflation up. Governing Council is carefully assessing these opposing forces on inflation. Monetary policy decisions will be guided by incoming information and our assessment of their implications for the inflation outlook. The Bank remains resolute in its commitment to restoring price stability for Canadians.”

With the focus on stabilizing prices, fixed mortgage rates may go down soon, helping economic growth and borrowing. Variable-rate mortgage holders will see their rates drop immediately from this announcement.

I believe that mortgage rates should decrease in the near future, but it’s important to stay updated on future announcements and economic changes. The next rate announcement is scheduled for Wednesday, October 23, 2024.