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Mortgage Minute


Blog by Patrick O'Donnell PREC* | March 4th, 2020


The Bank of Canada today lowered its target for the overnight rate by 50 basis points.
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Great news for variable rate holders.  Now we will see if the banks pass along the full drop as in the past they have, on occasion, only passed along part of the drop, thus earning extra profit for themselves.  

The Bank of Canada today lowered its target for the overnight rate by 50 basis points.

The Bank of Canada notes: "While Canada’s economy has been operating close to potential with inflation on target, the COVID-19 virus is a material negative shock to the Canadian and global outlooks, and monetary and fiscal authorities are responding."

Furthermore, the bank adds that "as the situation evolves, Governing Council stands ready to adjust monetary policy further if required to support economic growth and keep inflation on target. While markets continue to function well, the Bank will continue to ensure that the Canadian financial system has sufficient liquidity.”

 

Source:  Mortgage Professionals Canada