The Bank of Canada announced today that it will not be changing its overnight rate. Therefore the Prime lending rate remains at 3.00%.
The global economy is still experiencing a widespread slowing of activities. Economic growth in the US is progressing at a gradual pace. Europe is in a recession and recent indicators point to a continued contraction. In China, and other emerging economies, growth has slowed somewhat more than expected..
Notwithstanding the slower global momentum, prices for oil and other commodities produced by Canada have, on average, increased in recent months.
Economic growth, in Canada, is still expected to pick up and return to full capacity by 2013. Housing activity is expected to decline from historically high levels, while household debt is expected to rise further. Core inflation has been lower than expected and projected to rise gradually over coming quarters.
With rates remaining the same, 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 December 4 2012.