There have been some exciting changes to the mortgage rates in the last week as the Bank of Canada cut rates last Tuesday. The overnight rate is now 1% so it cannot go much lower. There may be one more cut on March 3rd but it is not certain, and is only expected to be ¼% or a ½% off of the current 3% it is now. Yes, the banks have managed to keep the small ¼% cushion that they did not pass on last month without too much public outcry. The article at the end of this is about how RBC makes an extra $12 million a day that the cushion continues - banks do not lose money for long. The latest rates & much more at Market Update Feb 09.pdf (170.62 kb)

As central bankers clamor to attach parachutes to the falling stock prices by infusing capital in anyway possible, we have seen stocks and currencies rise and fall daily with more volatility than even the most seasoned traders can stomach. Both prospective and existing homeowners have seen mortgage rates steadily increase over the past 2 months as banks try to claw back their losses and price in the increased risk associated with holding mortgages.

See attached full article.

Market Update November '08.doc (243.00 kb)