Canada column for Sunday, July 15/18
THE CANADIAN REPORT
By Jim Fox
Canadians are paying more for variable rate mortgages and lines of credit as the central bank raised its key interest rates over free trade concerns.
The Bank of Canada upped the rate by 0.25 percent to 1.5 percent, the fourth increase in a year as the economy heats up with strong employment gains.
Canada’s major banks followed by increasing their prime-lending rates one quarter of a point to 3.7 percent.
Bank Governor Stephen Poloz said the increase was prompted by “the various uncertainties we face” with trade tensions the biggest issue for the country.
As for U.S. tariffs on steel and aluminum, there could be difficulties for some industries and workers but “the effect of these measures on Canadian growth and inflation is expected to be modest,” he said.