The Bank of Canada’s next interest rate announcement is this Thursday.
Action Economics expects “the BoC to maintain the 0.25% rate floor and reiterate the conditional commitment to keep the floor intact through June of 2010.”
Bloomberg’s survey of 21 noted economists backs that up. Every economist who was polled forecasts no change to the BoC’s 0.25% target rate.
I guess all you can do is follow the trends, if the USA keeps lower rates then I guess everyone else is bound to.
When will the big banks pass on that extra 0.25% that they didn’t pass on when the BoC cut 75 bps and the big banks only cut 50 bps?
Now that libor is at an all time low, why isn’t there an outrage? I know we’re all Canadians, but someone oughta speak out …
Speak out about what? This is a semi-free market after all, they can charge whatever people are willing to part with (or give up in life energy).
Didn’t they eventually cut that extra .25?
“Didn’t they eventually cut that extra .25?”
Once they did, after a big of a delay. There was another time that they didn’t. Given how many times the BoC dropped rates, it was hard to keep track!
They didn’t, overall. The spread was always BoC overnight rate + 1.75% = banks prime rate.
Now it’s 2% (2.25% – 0.25%).
The one they didn’t pass on was the 75 bps move in December, they passed on 50 bps out of the 75. The next 3 cuts they matched fully, but they never did give back that 25 bps from December.
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