The Bank of Canada, at last week's meeting, left the Prime rate at the same level once again. This is the 14th consecutive meeting where they have decided to leave the Prime Lending rate right where it is. The last time the raised the rate was September 2010 where it went up from .75% to 1.00% But how long can this last? Well according to the latest research from RBC Economics the forecast for rate increases has changed a little. The forecast is still predicting that the Prime rate will rise a full percentage point by the end of next year. The change comes in when this will occur. Previously the forecast had the Prime rate starting to rise in the first quarter of next year. That has now been pushed back until the second quarter of 2013. Please note though a change in the Prime rate effects Variable rate mortgages and loans only and not fixed rates. Usually fixed rates will rise first in anticipation of the Prime rate going up. That's why it's always good to get a rate held for as long as you can if considering taking out a mortgage. Our regular rate holds are for 120 days or approximately 4 months.
For the the full report on why the change in forecast and for all the positive news as well as some of the headwinds the Global Economy is still facing click on the link below:
Tony Marchigiano | Mortgage Specialist - Mortgage Sales BC Region, RBC Royal Bank | Royal Bank of Canada | T. 604-505-7109 | F. 778-737-0054
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