Bank of Canada Increases Overnight Rate

The Bank of Canada met this morning and increased their overnight rate, which means that Prime is heading up. Don’t panic!  This is normal. Check out the photo above, showing the pattern of the overnight rate going back to 1993.

Today the overnight rate increased to 1.50%. Just over 10 years ago in 2007, the rate was 4.25% which made Prime rate 6.25% at that time.  With this increase Prime will likely go up from 3.45% to 3.70%.

In reality this is good news because it means the overall economy is growing.  Please remember that only variable rate mortgage holders are impacted by increases to the overnight rate and therefore the Prime rate.

If you are a variable rate mortgage holder and have questions or are wanting to lock in your mortgage, simply send us an email or give me a call at 604 336-6575.

The next meeting of the Bank of Canada is September 5th and we will be sure to update you again.