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<\/p>\nThe Bank of Canada made it scheduled announcement this morning and has held firm with its ‘Overnight Rate’ at 1%.<\/p>\n
This is generally good news for the housing market as it keeps interests rate low and mortgages correspondingly affordable for most prospective buyers.<\/p>\n
Some economists are predicting that the rate will remain at this level or, surprisingly, made even go slightly lower due to pressures in the global economy and instability in Eastern Europe among other reasons.<\/p>\n
Below is part of the Bank’s announcement:<\/p>\n
<\/p>\n
OTTAWA \u2013 The Bank of Canada today announced that it is maintaining its target for the\u00a0overnight rate at 1 per cent. The Bank Rate is correspondingly 1 1\/4 per cent and the deposit rate is\u00a03\/4 per cent.<\/p>\n
Total CPI inflation has moved up to around the 2 per cent target, sooner than anticipated in the\u00a0Bank\u2019s April Monetary Policy Report (MPR), largely due to the temporary effects of higher\u00a0energy prices and exchange rate pass-through. Core inflation remains significantly below 2 per\u00a0cent although it has drifted up slightly, partly owing to past exchange rate movements.\u00a0Global economic growth in the first quarter of 2014 was weaker than anticipated in the MPR and\u00a0recent developments give slightly greater weight to downside risks. The U.S. economy is\u00a0rebounding after a pause in the first quarter, but there could be slightly less underlying momentum\u00a0than previously expected. Globally, long-term bond yields have continued their decline, reflecting\u00a0in part growing market anticipation that interest rates will remain low over the long term. This,\u00a0along with buoyant stock markets and tight credit spreads, indicates that financial conditions\u00a0remain very stimulative.<\/p>\n