The Bank of Canada located in Toronto has released a statement indicating that they are reducing their lending rate by half of one percentage point. This reduction will result in lower rates for mortgage borrowers, but a lot of it depends on how the local institutions will handle the funds. Financial experts in the UK are saying that if a change isn’t seen in areas such as mortgage rates, then it is a direct result of mismanagement of funds.
Key Takeaways:
- Concerns regarding the novel coronavirus were instrumental in Canada’s decision Wednesday to cut the country’s key lending rate.
- The instituted half a percentage point drop is supposed to lead to potentially lower mortgage rates.
- However, the savings is contingent upon the financial institutions, which can choose to profit or pass on the savings.
“He said the rate cut is a sign that there could be a recession and people should factor in maybe not getting the raise they’re expecting or even getting laid off.”
