No Rate Change, Brexit, and OSFI Tightening

Newsletter provided by Hein Moes, Mortgage Consultant,  Invis                                                                                                   Reprinted with permission

Bank of Canada Holds Benchmark Rate

The Bank of Canada announced today that it is holding the key rate steady. The Bank cut its 2016 GDF forecast, but noted that fundamentals are in place for a pickup in growth, although in a climate of heightened uncertainty. Canada had a weaker second quarter “pulled down by volatile trade flows, uneven consumer spending, and the Alberta wildfires.” A pick up is expected in the third quarter as oil production resumes, Fort McMurry rebuilds, and as consumer spending gets a boost from the Canada Child Benefit. Inflation remains in the Bank’s inflation-control range, although “the implications of the Brexit vote are highly uncertain and difficult to forecast,” and “financial vulnerabilities” are emerging in Vancouver and Toronto. The Bank judges that “the current stance of monetary policy is appropriate.”

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