Higher Interest Rates
By Elli Davis, June 6, 2010
Vancouver 467 by Rick Lawrence
Interest rates in Canada are not so low anymore! Just as expected, the Bank of Canada has decided to raise the key lending rate on June 1st. The overnight rate is now 0.5 percent. Out of all the G7 states, our country is actually the first one to raise the rates since the financial crisis started in July 2008.
This decision came, the bank claims, partly due to a strong domestic demand, an excess supply and slowing wage growth, which means inflation, has increased as expected. According to the governor of the central bank, Mark Carney, the not so surprising announcement from the bank, certainly, “still leaves considerable monetary stimulus in place.”
Honestly, this was probably the most expected move the Bank of Canada has made in months. I don’t think anyone is really surprised. The pressure or tensions regarding the uncertainty over the rates are finally gone - now let’s just wait and see when the next raise is going to occur.