The latest inflation numbers or Consumer Price Index is a welcomed development for most people in this country. The rate dropped to two-percent in the latest report released this week which is at the bottom end of the Bank of Canada’s target range.
So… we should probably expect interest rates to start falling more rapidly.
In the week’s leading up to this report, there were economists starting to express the view that the central bank should get more aggressive in its rate cutting…perhaps trimming a half a point at a time rather than the one-quarter percent rate they have been moving in the last three settings.
And now, with inflation falling faster than expected, the calls will only grow. For example, the economists at CIBC Capital Markets last week issued a forecast projecting the bank rate would fall by a further two full percentage points in the next nine months.
Another chartered bank says a ‘wall of Canadians’ have mortgages coming up for renewal in the next 18 months and a quicker interest rate reduction may be enough to prevent some significant financial damage.
