July 20, 2010

Economic forecast & rate increase July 2010

Calgary Mortgage Rates

Effective: July 20, 2010
Term Market Rate** Best Rate***
Adjustable Prime Prime - 0.60%
6 month 4.85% 3.95%
1 year 4.05% 2.54%
2 year 4.55% 3.20%
3 year 5.21% 3.60%
4 year 5.74% 4.09%
5 year 6.25% 3.99% Quick Close
4.19% Pre-approval
7 year 6.59% 5.00%
10 year 6.90% 5.20%
Prime 2.50%

Rate Increase from Bank of Canada!

Bank of Canada Increases Overnight Rate Target to 3/4 Per Cent

OTTAWA, July 20

The Bank of Canada today announced that it is raising its target for the overnight rate by one-quarter of one percentage point to 3/4 per cent. The Bank Rate is correspondingly 1 per cent and the bank Prime rate is now 2.7 per cent.

Economic activity in Canada is unfolding largely as expected, led by government and consumer spending. Housing activity is declining markedly from high levels, consistent with the Bank's view that policy stimulus resulted in household expenditures being brought forward into late 2009 and early 2010. While employment growth has resumed, business investment appears to be held back by global uncertainties and has yet to recover from its sharp contraction during the recession.

The Bank expects the economic recovery in Canada to be more gradual than it had projected in its April. This revision reflects a slightly weaker profile for global economic growth and more modest consumption growth in Canada. The Bank now expects the economy to return to full capacity at the end of 2011, two quarters later than had been anticipated in April.

Reflecting all of these factors, the Bank has decided to raise the target for the overnight rate to 3/4 per cent. This decision leaves considerable monetary stimulus in place, consistent with achieving the 2 per cent inflation target in light of the significant excess supply in Canada, the strength of domestic spending, and the uneven global recovery.

Given the considerable uncertainty surrounding the outlook, any further reduction of monetary stimulus would have to be weighed carefully against domestic and global economic developments.The next scheduled date for announcing the overnight rate target is Sept. 8

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