Bank of Canada Rate Announcement January 2024

Date Posted: January 24, 2024

The Rate Increase

In a recent announcement, the Bank of Canada maintained the overnight rate at 5%, announcing no change to the current rate. The bank is also maintaining its policy of quantitative tightening.

Many industry experts were hoping that the bank would begin lowering rates, however, some lenders have already begun decreasing some of their offered rates.

What Does This Affect?

The Bank of Canada’s target overnight policy rate affects the interest you pay from lenders like banks. The higher the overnight rate, the more interest you’ll pay. The Bank of Canada maintaining the policy rate means that mortgage payments would stay the same as they were.

Getting Back on Track

The Canadian economy has entered a period of weaker growth, which is needed to relieve price pressures. After easing to 2.8% in June, CPI inflation moved up to 3.3% in July, averaging close to 3% in line with the Bank’s projection. With the recent increase in gasoline prices, CPI inflation is expected to be higher in the near term before easing again.

If you have questions about your own mortgage, and the best strategy for you, please contact your broker today.

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BoC Announcement