Brokers on bank rate

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An overwhelming number of brokers believe the Bank of Canada will maintain the overnight rate at 0.75 per cent with its rate announcement today.

“I think they will keep it the same – there hasn’t been enough (economic) change in the past few months since the previous change,” Jean-Guy Turcotte with Dominion Lending Centres Regional Mortgage Group told “I actually think it will be flat for the next two months.”

A recent poll revealed 87 per cent of brokers believe the Bank of Canada will hold its overnight rate.

Meanwhile, four per cent believe the Central Bank will hike the rate and nine per cent believe it will be lowered.

While holding the rate seems like the obvious choice, brokers know nothing is certain when it comes to the BoC’s decisions, after it surprised the market with a rate cut in January.

However, many experts also agree that the rate will remain unchanged.

“The Bank of Canada is expressing optimism that the Canadian economy will improve during the remainder of this year,” Will Dunning, chief economist for CAAMP wrote as part of’s expert panel. “On that basis, we should not expect any changes in its overnight rate at the next meeting.

“But, I see some risks that the economy will be weaker than the Bank of Canada expects,” he continued. “In that case, there could be another surprise reduction at the meeting dates of July 15 or September 9 (by a quarter point).”
  • Faye Drope on 2015-05-27 12:56:32 PM

    September it will go down.

  • Murray on 2015-05-27 1:00:37 PM

    why are the banks not required to follow the BoC rate drop? twice since 2008 they have refused to follow BoC rate drops. we should still have Bank Lending rates at BoC prime plus 1.5%. i dont see why the Feds can't enforce this a regulation.

  • Michele Hall on 2015-05-27 2:19:12 PM

    did anyone hear that the states may raise their rate ? this could affect BoC decisions going forward.

  • Darr Robbins on 2015-06-04 7:49:41 AM

    There's not enough banks in Canada. No Competition! Bank concentration measured on a Herfindahl index in Canada is off-the-scale. About the Herfindahl index :

    @Michele Hall
    The undisputed fact is that US economy is 70% consumer related.
    With high unemployment, off-shoring manufactures, no assets and high debt, where will US consumers find the cash to spend their way out of their recession?
    The FED will never raise rates that will crash the US capital markets.
    Poloz at the BOC knows this and will drop rates in Canada as well to prevent the Cando from rising against the US dollar.

  • Ron Butler on 2015-06-04 1:05:32 PM

    I guess Faye must have a 2 or 3 million dollar hedge position on the rate drop in September because if I were as certain as her that's what I would do.

  • Darr Robbins on 2015-11-05 10:08:01 AM

    Hedging against a rate drop was not a wise decision. Central bankers have no other tool. They have painted themselves in a corner. Rates will go negative before this cycle is over.

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