As expected, the BOC raised the overnight rate by .50%, this means everyone with a variable mortgage will see their rate go up by .50%. They also announced today that they will most likely increase the rate again by another .50% at the next meeting in July. Although this seems aggressive, we have been advising clients that this was most likely coming and that they will continue to increase rates to pre-pandemic levels.
The BOC is desperately trying to fight inflation which currently sits at 6.8% and as long as our unemployment numbers stay low, they are committed to increasing rates to drive inflation down.
Although they will be monitoring the effects of these aggressive rate hikes and making sure the economy can withstand them, many people think the government has missed the boat on this!
Many feel the government should have started slowly increasing rates in 2021 to ease back into more normalized rates, instead, they are now playing a fast game of catch-up at the expense of the Canadian consumer.
Please remember two things,
Don’t panic at this time;
It’s always a good idea to speak with your trusted MonsterMortgage.ca advisor.