Interest rates are likely on the rise in Canada

July 5th, 2017  |  Personal Finance

On July 12th, The Bank of Canada is set to announce the fate of their upcoming interest rates and it is likely that Canadian’s are going to see them rise.

The rates that The Bank of Canada implements tend to set the trends for other institutions within the country, having an impact on the rates that Canadians experience with their loans or savings, mortgages, and other various products.

The nation has not seen an increase in rates since September, 2010; however, as soon as next week, that may change. The bank’s board of governors meets eight times a year to assess the current financial climate and determine whether the Canadian economy would benefit from higher or lower interest rates. There have been 54 meetings in which the choice was to keep rates low, however, this meeting may yield a different result.

The hike is something that many have seen as a long time coming, dating back to 2015. In 2015 the projected rise in interest was said to provide temporary help to the Canadian economy, as it was experiencing troubles due to dropping price of oil. Even though they did not go through with the rise then, and oil is still sitting at an average of $40 a barrel, the bank has dropped hints that they are ready to “get back to normalcy” and raise interest rates.

Current rates sit at .50%, and while an increase is in the cards, it is not projected to be a staggering hike. It is expected that the rise will be no more than .25%, bringing interest rates to no higher than .75%.