Why did the bank of Canada raise its interest rate?

The Bank of Canada has raised its benchmark interest rate by another 25 basis points, bringing it to levels not seen since 2001 amid fears the decline in inflation “could stall.” Economists say the latest move is a warning to Canadians not to expect rate cuts anytime soon, and that future rate hikes are not off the table.

What is Canada's New interest rate?

The central bank raised its benchmark interest rate to 4.75 per cent on Wednesday, an increase of a quarter-percentage point in its first hike since January. The policy rate, which sets the cost of borrowing in Canada, now stands at its highest level since May 2001.

How much did Canada's Mortgage rate hikes add to the monthly payment?

The rate hikes already announced have added more than $1,000 to the monthly payment on a $500,000 mortgage — and that's before Wednesday's increase. Within hours of the central bank's decision, Canada's big banks all moved to match the bank's hike, raising their prime lending rates to 6.95 per cent.

Which Canadian banks have moved their benchmark rates?

Two of Canada's big banks have already moved their benchmark rates in response, with Royal Bank and TD raising their prime lending rates from 3.7 per cent to 4.7 per cent as of Thursday morning. The other major lenders are expected to follow suit in short order.