RENNIE OUTLOOK 2021
The unprecedented monetary stimulus introduced by the Bank of Canada at the outset of the Covid-19 outbreak— including lowering the overnight target interest rate to (effectively) zero and engaging in a bond-buying program that pushed longer-term interest rates to historic lows—provided much-needed stability to households and businesses in 2020. As the economy continues to recover and as long as inflation remains below the 2% threshold for a prolonged period of time, the Bank of Canada’s actions (or inactions, depending on how you look at it) are likely to suppress interest rates throughout the economy into 2023.
OUR 2021 OUTLOOK It is unlikely that the Bank of Canada will change its policy interest rate in 2021 from its current 0.25%. However, with the Canadian economy stabilizing in the wake of the pandemic, and fewer investors seeking shelter from riskier investments, fixed mortgage rates could rise by up to 0.5 percentage points.
Copyright © 2021 rennie group of companies. All rights reserved. This material may not be reproduced or distributed, in whole or in part, without the prior written permission of the rennie group of companies. Current as of January 18, 2021. All data from Real Estate Board of Greater Vancouver and Fraser Valley & Rennie. While the information and data contained herein has been obtained from sources deemed reliable, accuracy cannot be guaranteed. rennie group of companies does not assume responsibility or liability for any inaccuracies. The recipient of the information should take steps as the recipient may deem necessary to verify the information prior to placing any reliance upon the information. The information contained within this report should not be used as an opinion of value, such opinions should and can be obtained from a rennie and associates advisor. All information is subject to change and any property may be withdrawn from the market at any time without notice or obligation to the recipient from rennie group of companies. E.&O.E. 9
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