Variable mortgage rates will stay where they are well into the Spring and Summer markets. The Bank of Canada’s next meeting date to review and adjust the overnight lending rate is April 17th when there is almost no chance of a rate change. In fact, the prime lending rate is so well balanced right now that we are seeing some economists call for a rate drop. Overall, the vast majority of pundits are predicting no change with a slight minority calling for either increases or decreases.
Economic data from across the globe remain relatively flat, and now that the Canadian housing market has slowed there are no inflationary concerns. Another factor weighing on the Bank of Canada was an overvalued currency. Now that the Canadian dollar has dropped well below parity with the US greenback there is significantly less pressure on policy makers to use interest rate discretion to manipulate dollar values.
These economic factors together with the softened language from the Bank of Canada governor make it clear that interest rate policy for the next few months will remain at steady as she goes with near record low variable mortgage rates.