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Bank of Canada Keeps Prime at 3%

For the 6th consecutive meeting the Bank of Canada has not moved on the prime rate. While during the election there was building anticipation that the BoC would head most economists calls to raise rates, there has been increasing evidence of slowing growth in the US and EU. The continued sovereign debt issues of many EU countries has created a high level of uncertainty. While a rising prime is inevitable it remains to be seen exactly when that is going to happen.

The Up and Down of Rates in 2011 - Below 4% again

My last most, much too long ago indicated that rates were moving up. Which they did. But since then, with persistent pessimistic outlooks for US and EU growth, they have continued to trend back down. It is unlear at this point as to where rates are going from here. But they have broken down pass the 4% level (5YF) for a number of lenders. While I'm still a firm believer that the safety and security of a 5 year fixed is the way to go for many of my clients a fair argument can be made for variable. While riskier, it is hard to see a bright enough light at the end of the tunnel to think that the level of uncertainty about economic growth is going to change any time soon.