Canadian Interest Rate Threatens A Hike

The low, low interest rate of 1% set during the uncertainty of recession times, September 2010 could soon be coming to an end according to the Bank of Canada. Consumers have been rushing headfirst to start borrowing at this rate since it was instituted, causing officials to repeatedly caution the public and the overall household debt of the nation to increase sharply. Now, due to the steady inflation of Canadian currency, interest rates are set to rise sharply, though some say not yet. The Financial Post claims that banks will keep up their “tough talk”€ but will not act on it for a while, citing the subtle rise in energy costs as evidence. Many economists suspect that interest rates will begin to rise ever so slowly by the end of this fiscal year. First time buyers and honeymooners be warned, the Canadian housing market is about to cool off. Financial post reports that, €œNewfoundland and Labrador had the highest inflation rate last month, at 3%. Nova Scotia and New Brunswick were also above the national average, both at 2.6%. The lowest rate was in Alberta, at 0.8%, falling costs for electricity and natural gas, while British Columbia had an annual increase of 1.6%.€