Many experts expected the Bank of Canada to soon announce a rate cut, but with recent inflation figures still above 3%, there is a risk of accusations of the status quo. Wednesday.
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“It is certain that there will be no drop to 99.9% on Wednesday,” mentions Michel Girard, economic columnist at the Journal de Montréal.
However, maintaining the key interest rate does not mean that there will not be a possible cut later in the year.
“I think there will be a rate cut, but more likely in the third quarter, i.e. in the fall. I assume that we can lose at least one percentage point by the end of the year. We could go from 5% to 4%.”
A downward trend
The economic market is already showing the first encouraging signs for citizens who are demanding a reduction in the key interest rate.
“You should know that interest rates have theoretically started to fall. I am referring to the guaranteed investment certificate. When I look at the performance from the beginning of December to today, there has been a decline of half a point to a percentage point. There is a risk that this will affect mortgage rates in June,” explains the specialist.
The business columnist recommends that homeowners who need to renew their mortgage rate in the coming months “opt for the variable rate because this rate will follow the decline in the base rate.”
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