Monday, July 3, 2017

Bank of Canada expected to hike interest rate for 1st time in 7 years next week

On July 12, Canada's central bank will announce its latest decision on where to place its trend-setting interest rate, which has an impact on the rates that Canadian borrowers and savers get. Recently the Bank of Canada's governor warned about Vancouver and Toronto home prices which are reaching 'bubble' status.

Eight times a year, the bank's board of governors meets to decide if Canada's economy needs a shot in the arm from a rate cut, or a pump of the brakes by way of a hike. And for the first time in 54 such meetings, it's the latter that's likely.

In practice the central bank is simply a follower of US Fed policy. Any way sliced it appears the cost of money is finally about to rise.