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Headline News - Interest rates increase. Will you be
paying higher interest rates in the future?
On Tuesday October 18th there was little surprise as
the Bank of Canada raised its overnight rate by 1/4
percentage point to 3 per cent.
"The Bank clearly states that further increases to the
overnight rate are coming in order to ensure inflation
remains well-behaved" quoted by an economist at Royal
Bank. The economist for TD Bank predicted that
overnight rate will be at four per cent by April.
The global and Canadian economies have continued to grow
at a solid pace. At the same time, there have been
significant movements in energy prices and the Canadian
dollar has traded in a higher range. Overall, the Canadian
economy now appears to be operating at its full
production capacity.
The Bank projects that the Canadian economy will
continue to operate at about its production potential
through 2007. CPI and core inflation are projected
to be 2 per cent in the second half of 2006, although
CPI inflation is expected to average near 3 per cent
until then, boosted by high energy prices.
In line with the Bank's outlook, and given that the
Canadian economy now appears to be operating at
capacity, some further reduction of monetary stimulus
will be required to maintain a balance between aggregate
supply and demand over the next four to six quarters,
and to keep inflation on target.
However, with the
risks of global outlook tilted to the downside as we
look to 2007 and beyond, the Bank will monitor
international developments particularly closely.
More generally, the Bank will continue to assess the
adjustments and underlying trends in the Canadian
economy, as well as the balance of risks, as it conducts
monetary policy to keep inflation on target over the
medium term.
What does all this have to do with you as a consumer?
What are the implications for your wallet?
The Bank of Canada's next scheduled date for announcing
the overnight rate is December 6, 2005.
Between now and then do you need to look at your
financial situation? Are you paying too much interest?
Is it time to lock in to a fixed rate mortgage? You can
click on "Current Rates" on the right
side-bar to find up-to-date rate information.
On September 30th, I moved from Mortgage 1 broker house
to Canada First Mortgage to serve you more effectively.
Check out my new website at
www.canquestmortgage.com You can fill out a
mortgage application on-line and find other pertinent
information.
Let me know if I can be of assistance to you to help you
save money in this rising mortgage rate environment.
Sincerely,
Karen Loehndorf, AMP - Accredited Mortgage
Professional
CANQUEST MORTGAGE
Suite 1622 – 246 Stewart Green S.W
Calgary, Alberta, Canada
T3H 3C8
direct:
403.242.4392 cell: 403.861.6969
fax: 1.403.249.4536
email:
karen@canquestmortgage.com
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