Mortgage Logic

B of C Rate Announcement – English Literature at its Finest

Today the Bank of Canada has, on it's scheduled announcement date, decided to again leave their Key Overnight Lending Rate alone at 1%. This should in turn influence key Canadian financial institutions to leave their Prime lending rate(s) at 3%.

We have a allot of respect for people that can take the driest of subject matter and turn it into words to ponder! Articulation at its best - finding new words that are not often used, to paint a picture that really has some meaning. Outgoing Bank of Canada Governor, Mark Carney, issued his last monetary policy update on April 17. He will soon be leaving Canada to take on the role as Governor of the Bank of England. It is an absolute work of art to be able to say the same thing over 20 consecutive times, and make it sound interesting. For example:

"With continued slack in the Canadian economy, the muted outlook for inflation, and the constructive evolution of imbalances in the household sector, the considerable monetary policy stimulus currently in place will likely remain appropriate for a period of time, after which some modest withdrawal will likely be required, consistent with achieving the 2 per cent inflation target."

Nothing has really changed with the exception of singling out the real estate market in general. "Constructive evolution of imbalances in the household sector" sounds much better than: the market has slowed down significantly, the condo market is weak, job loss in the housing sector may reach 200,000 due to a real estate slowdown, many borrowers no longer qualify for mortgages and household credit had its slowest annual growth in more than 15 years this April!

Continued stability with interest rates for now, and the foreseeable future.

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