Personal Finance

Bank of Canada lowers overnight rate target to 0.5%

  • Last Updated:
  • Jul 30th, 2015 2:12 am
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489 replies
Deal Addict
User avatar
Dec 12, 2005
4901 posts
582 upvotes
Greater Toronto Area
Yeah......now the damn banks better lower the rates also..
Sr. Member
Sep 25, 2006
598 posts
58 upvotes
Ottawa
I have a feeling we'll only see a 0.15% like the last drop.
Jr. Member
Jul 3, 2011
128 posts
49 upvotes
Toronto
gizmo8 wrote: Yeah......now the damn banks better lower the rates also..
They probably won't. But you can rest assured that whenever rates rise again (hopefully in a long, long time) the banks will implement the full increase.
Deal Fanatic
User avatar
Apr 20, 2011
5310 posts
484 upvotes
Vancouver
hopefully rate spy and rate hub will have updates
Deal Addict
Dec 19, 2009
1611 posts
2099 upvotes
Ottawa
What kinds of things do banks consider when deciding to follow the BoC decrease or not? Not really sure how this process works...
Deal Fanatic
Oct 7, 2007
9277 posts
5105 upvotes
I think this is terrible news for the following reasons:

a. lowering rates will push real estate prices even higher
b. it will cause people to take on even more debt
c. it will make our dollar less valuable (e.g. if we want to travel to the US it is becoming almost unaffordable)--personal selfish reason
d. it hasn't done much for us in the past so why keep doing it expecting a different outcome
e. it will make it tougher to adapt to rate increases if they ever happen
f. it leaves less room for a cut if and when we really need one in the future

Why does government think taking another "hit" of the debt drug is good for the people? This is not going to end well.

My gloomy two cents.
Deal Guru
May 1, 2012
10426 posts
11103 upvotes
Toronto
People don't get it. This isn't the economic conditions of times past. We are living in a time of extreme low economic confidence, which translates into extreme low interest rates.

What you consider to be a normalization of interest rates, is probably closer to the lower 1-2% than it is to the 5-7% you were used to.


If economies aren't growing in a world of emergency interest rates, what makes you think it will ever grow to a point to warrant much higher rates?
Deal Addict
User avatar
Jan 28, 2012
1763 posts
648 upvotes
choclover wrote: I think this is terrible news for the following reasons:

a. lowering rates will push real estate prices even higher
b. it will cause people to take on even more debt
c. it will make our dollar less valuable (e.g. if we want to travel to the US it is becoming almost unaffordable)--personal selfish reason
d. it hasn't done much for us in the past so why keep doing it expecting a different outcome
e. it will make it tougher to adapt to rate increases if they ever happen
f. it leaves less room for a cut if and when we really need one in the future

Why does government think taking another "hit" of the debt drug is good for the people? This is not going to end well.

My gloomy two cents.
Insanity, absolute insanity

The government is trying to cover their incompetence by goosing the economy for just a few more months. They are hoping that it's enough to win, and then when everything goes to hell and it turns out the budget isn't balanced this year after all, it will be too late.
Member
Aug 19, 2013
432 posts
379 upvotes
Etobicoke
Goodbye to cross border shopping.
Deal Addict
Apr 27, 2010
1567 posts
372 upvotes
This is a really bad move of cutting another quarter point. They should have leave it along even the growth rate decrease.
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Deal Addict
Feb 24, 2008
3363 posts
2022 upvotes
Mississauga
TD lowered to 2.75; expect the others to follow
Deal Fanatic
User avatar
Apr 20, 2011
5310 posts
484 upvotes
Vancouver
Lower dollar helps exporters that sell Canadian products to the world . The governor said any housing effects are a side effect.

Shopping in Canada is what people are supposed to do.
Member
Aug 26, 2009
450 posts
59 upvotes
Toronto
mau_mau wrote: TD lowered to 2.75; expect the others to follow
Wow, only 10bps? rest assured when the rates go up they will pass on the full rate hike.
Member
Aug 26, 2009
450 posts
59 upvotes
Toronto
mau_mau wrote: TD lowered to 2.75; expect the others to follow
This has to be the fastest response by a bank to rate cut in the recent history (or ever).
Sr. Member
Feb 8, 2015
622 posts
690 upvotes
Kanata
choclover wrote: I think this is terrible news for the following reasons:

a. lowering rates will push real estate prices even higher
b. it will cause people to take on even more debt
c. it will make our dollar less valuable (e.g. if we want to travel to the US it is becoming almost unaffordable)--personal selfish reason
d. it hasn't done much for us in the past so why keep doing it expecting a different outcome
e. it will make it tougher to adapt to rate increases if they ever happen
f. it leaves less room for a cut if and when we really need one in the future

Why does government think taking another "hit" of the debt drug is good for the people? This is not going to end well.

My gloomy two cents.
This is terrible news for for those who haven't bought yet and are still in the market to buy a home.

a. real estate prices will be pushed even higher. That's great if you already bought a home
b. It will cause people to take on more debt. If you bought already, your mortgage is the same. In fact, it should be lower since you are repaying it every month


onebuddy wrote: Goodbye to cross border shopping.
Isn't that also a good thing? So many people preach to buy Canadian and not foreign. Thus now we are more inclined to buy local and support local
Deal Addict
Jan 2, 2015
1633 posts
638 upvotes
Toronto, ON
CIBC had previously lowered their prime rate from 3 to 2.85%, so I guess it'll go down again now. That'd be good for me if I ever actually used my line of credit, but I don't. Instead, the savings rate on my savings account will probably drop. It's already 1.05%, dropped from 1.3% earlier this year.

That Tangerine promo looks better and better, but I don't know if it's a "sure thing" for new customers.

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