Bank of Canada announed that they will be keeping the prime rate at 3%, unchanged for quite a while.
The past tells us that Canada follows the United States’ economic policies and trends. Why is this interesting? Because when the U.S. sneezes, Canada catches a cold.
The U.S. Federal Reserve has quoted saying they believe their rates will not move until 2014-2015. What is interesting is that it seems as of 2008, Canada has chosen to make it’s own path.
The U.S. as we all know had a financial meltdown in 2008, which in result pushed economies world wide into a recession. Canada, was able to come out of this with almost no damage. We had no meltdown, no banks failed and more importantly, no housing crash.
Our banks even reported billion dollar quarterly profits! We are a prime example and envy of the world in a financial manner.
Though we still follow the U.S. trends closely, and not having rates go up until 2014-2015, means we will probably see rates here in Canada stay low for a little while as well.