Bank of Canada’s First Rate Cut in 4 Years: What It Means for You!

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The Bank of Canada cut its benchmark interest rate from 5% to 4.75%, marking the first cut in 4 years. In this video I'll share five key takeaways from this choice, including its implications for borrowing expenses, the property market, and future economic policies.

Likewise in this episode:

United States Private Payroll numbers fell short in Might, with just 152,000 tasks added, showing a slowing labor market.

TC Energy Corp. investors approved the spin-off of the liquids pipeline service into a brand-new company, South Bow Corp, to manage debt and enhance operations.

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Bank of Canada’s First Rate Cut in 4 Years: What It Means for You!

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About the Author: Richard Money

44 Comments

    1. I dont care. I charge in usd and export products manufactured in Canada. Canada needs to start producing more so we have the income to offset the exchange rate

  1. Always great info for me to
    Learn something everytime i listen to you 🙂 cheers from Montreal!

  2. I reserved my Vancouver ticket & booked my sitter! Excited to meet the group 🙌🏼

    1. Exactly. We are already at 1.37 usd/cad. We don’t need this right now. Historically, the USA does NOT cut rates at ALL in an election year. If we cut again this year, the road to 2.00 usd/cad will be cleared up. This will completely devastate the economy as many businesses rely on product from the USA.

    2. No this is good for real estate. I reccomend buying the Toronto condo dip. Tiff will keep cutting moon soon.

    1. We’re already 2nd lowest productivity in the G7. We can’t afford to tank the economy.

    2. @@epictetus3406 As someone who owns many properties, mortgage free. If you are the majority of Canadians that have a mortgage. You DO NOT want lower rates. Lower rates to me right now will only increase buyers in the market and increase bidding wars, driving prices higher. Which in turn only benefits property investors like me. I would expect this rate cut to increase properties 10-20%. I have a place for sale right now in Brighton, ON. It’s got 5 bids on it and will probably sell for over 120k over asking. In short. We have not seen enough real estate deflation to support a rate cut. But hey. Put more money in my account, BoC. If interest rates stayed up and lowered home prices correctly, I would have retired years ago. This is a huge failure on the liberal government to lower rates right now. It should have at least held steady until after the USA election, as the USA historically never cuts rates during an election year.

    3. @@epictetus3406 True, but interest rates are not going to materially affect Canada’s productivity. We’ve been declining in productivity for years and it has more to do with Canadian culture than interest rates. Having more gambling activity in housing is not going to improve productivity.

    4. @joe97nsx  you’re right, the interest rates aren’t the sole reason for the poor productivity but they are one more barrier that affects.

      Just like the interest rates aren’t the sole reason for poor productivity they are also not the sole reason for the housing crisis. Yes lower rates won’t improve the housing situation but higher rates won’t solve it either.

      If I had to choose between high house prices and the economy crashing I’d pick high prices.

  3. I think it is a mistake, historically interest rates were pegged at around 6%.
    There is a cost to money, it is not free, as what happened in the recent years.
    Banks charge interest to borrowers, if you have cash in any form, held by institutions, you should be compensated for their use
    I hope this is not the start of another cycle of lowering rates to nothing

    1. Shhhh my house is up for remorgaging next year. They can raise it again after my sub 2% rate is locked in again.

    2. @@MasterofPlay7 I think that has already happened. Gold was around $240 US in 2002 and now it’s almost 10 times higher.

  4. Why do I get the feeling that they did this just to increase it again, just so that people think that the rates could go up and down.

    1. That will dent the credibility of BOC,Unless there is a big jump in inflation 50/50 chance of another cut in July.

    2. I think its just confirms that the bank will do what our finance expert Crystia Freeland asks of them .

  5. Thank you for the new video! The rate cut is nice bit of good news. Maybe not a big deal right now, but like you said it could be the start of a happier trend.

    If I’m understanding correctly, TC Energy will remain a natural gas company while South Bow will specialize in oil pipelines. For each share of TC Energy investors own, we’ll also receive 0.2 South Bow shares.

  6. This 0,25% is a kiss on the bobo for stupid mortgage howner. THERE WILL BE A REALESTATE CORRECTION. If some people bough the fact that the BOC rate could stay at 1% for many years then they deserve to loose the right to borough by going bankrupt.

  7. My feeling is that rates should not have been raised to begin with….it was unnecessary.

  8. Why the headline, you are better than that, it’s the first rate cut after ~1.5 years of hikes

  9. Vs the US, we can’t reduce to far away from our neighbor if we want currency strength.

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