On July 13th, the Bank of Canada announced it would maintain its target overnight lending rate at 0.5%. On this same day, the advertised five-year lending rate was 4.74%, which is 0.1% higher than the last rate announcement.
According to the Canadian Real Estate Association, “The announcement repeated many of the themes from its announcements and Monetary Policy Reports published in late 2015 and early 2016. Chief among these themes is how the Bank is still counting on the continuation of low interest rates and stronger U.S. economic growth to buoy Canadian exporters amid ongoing weakness in Canadian business investment. However, the Bank again reduced its annual forecast for Canadian economic growth in light [of] ‘a weaker outlook for business investment and a lower profile for exports reflecting a downward adjustment to US investment spending.’ It also recognized how recent economic growth was reduced by the Alberta wildfires; however, it expects Canadian economic growth will pick up in the third quart as oil production resumes.”
The next rate announcement from the Bank of Canada is scheduled for September 7th.