Interest Rate Outlook

For anyone who is curious about where experts expect interest rates to be headed in the next while, the forecast is sunny skies: rates are not expected to rise.

Essentially, the Bank of Canada doesn’t expect that it will need to raise interest rates in the near future because of the strong Canadian dollar, the weak

U.S.
economy and “tighter” credit and lending practices. If everything proceeds as projected, the Bank of Canada shouldn’t have to touch interest rates through 2009.

The possibility that interest rates won’t increase bodes well for those looking to purchase a home or renew their current mortgage, as well as current mortgage holders that have variable or adjustable rate mortgages. Things could look even better for home buyers and owners if the central bank drops interest rates (provided

Canada
remains on target for the Bank’s desired level of inflation).

If you would like to read more about the outlook for interest rates, please visit the two articles on Canada.com titled Bank of Canada will hold rates through 2009 and Bank of Canada signals rate hold.