Raising rates is bad for Canada. Inflation has been as tepid as the recovery. If it weren't for Canadian commodities, the big banks would have a big hole in their bottom line. Lets face it, they are doing well stroking the stock market for each other, not lending, or paying much interest... unless they lend to their credit card companies and get to make unprecedented spreads: 18% spread? If there would have been a whiff of this 30 years ago when credit cards were allowed to enter the market, there would be no way politicians or banks could get away with it.
The BOC rate is eclipsed by these real drags on the economy. But increasing them makes everything worse, higher mortgage rates, notice how long they have been higher in anticipation of the next rate height? Ridiculous. I was ranting when the rates went to 1%, it was proved to be hard on the economy then, and future rates will be hard later. The dollar is high enough thank you.
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