Still at 1% – Bank of Canada Maintains Overnight Rate Target. “Ottawa -The Bank of Canada today announced that it is maintaining its target for the overnight rate at 1 per cent. The Bank Rate is correspondingly 1 1/4 per cent and the deposit rate is 3/4 per cent.” Read More from the Press Release. The next scheduled date for announcing the overnight rate target is 23 October 2013. The next full update of the Bank’s outlook for the economy and inflation, including risks to the projection, will be published in the MPR at the same time.
This press release comes as good news for those with Variable Mortgage Rates, as the Bank of Canada overnight rate has a direct impact on Variable Mortgage Rates. The Bank of Canada Overnight Rate is the rate other participants in the money market borrow and lend one-day funds to each other. When the Bank changes the Overnight Rate Target, this change usually affects other interest rates, including mortgage rates and prime rates charged by commercial banks. Variable rate mortgages typically offer a lower interest rate than fixed rate mortgages and when interest rates are low, you could pay off your mortgage faster and save money on reduced interest costs. The Bank of Canada Overnight Rate has been at 1% since October of 2012 and experts agree, the Bank of Canada Overnight Rate will not be changing anytime in the near future.
If you have been concerned about rising Fixed Mortgage Rates, you may want to discuss with your mortgage lender or mortgage broker your needs and concerns before obtaining or renewing your mortgage or locking into a fixed term. They are better to assess your personal situation and find you the best option for you and your mortgage. Find the Best Mortgage Rates and Current Mortgage Rates offered in Canada at CompareMyRates.ca.