Bank of Canada Holds Key Rate at 1% March 1st!

March 1st, 2011

The Bank of Canada holds their key lending rate at 1% for the fourth consecutive meeting. Banks therefore are expected to keep their prime rates at 3%.

The Bank of Canada’s key points:

Global economic recovery is proceeding in line with their projection in January, although risks remain elevated.
The recovery in Canada is proceeding slightly faster than expected, and there is more evidence of the anticipated rebalancing of demand.
There is early evidence of a recovery in net exports, supported by stronger U.S. activity and global demand for commodities. However they continue to face challenges from the strength in our dollar and Canada’s poor relative productivity performance.
Inflation in Canada has been consistent with the Bank’s expectations.

With rates staying low, we are continuing to recommend that clients stay in their variable rate mortgages. The date of the Bank of Canada’s next announcement is scheduled for April 12th, 2011.

If you would like to sign up for the rate watch please go to my website.