Bank of Canada Rate Announcement June 2024

Date Posted: June 5, 2024

The Rate Announcement

In a recent announcement, the Bank of Canada decreased the overnight rate to 4.75%, the first decrease we’ve seen since during the pandemic.

The Bank's Governing Council decided to decrease the policy rate and continue normalizing the Bank's balance sheet. As the global economy grew by about 3% and inflation in most advanced economies continues to ease, the Bank of Canada agreed that the monetary policy no longer needs to be as restrictive.

What Does This Affect?

The Bank of Canada’s target overnight policy rate affects the interest you pay from lenders like banks. The higher the overnight rate, the more interest you’ll pay. The Bank of Canada maintaining the policy rate means that mortgage payments would stay the same as they were.

Getting Back on Track

Recent data has increased our confidence that inflation will continue to move towards the 2% target. Nonetheless, risks to the inflation outlook remain. Governing Council is closely watching the evolution of core inflation and remains particularly focused on the balance between demand and supply in the economy, inflation expectations, wage growth, and corporate pricing behaviour. The Bank remains resolute in its commitment to restoring price stability for Canadians.

If you have questions about your own mortgage, and the best strategy for you, please contact your broker today.

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BoC Announcement