Will Interest Rates Keep Rising?
I read an interesting Bloomberg article titled ‘More people are going broke in Canada as interest rates rise’.
It goes onto say that the number of consumers seeking debt relief jumped 5.1% in November from a year earlier.
Usually interest rates are increased by the Bank of Canada if the economy can handle it, but not everybody is convinced.
Traders may be betting before tomorrow’s BOC report that interest rates are not going to get increased.
This could be one reason why the Canadian Dollar have jump 2 cents in the last three trading days.
There have been a few of other factors too.
Oil has been increasing off the lows, the US Dollar has been declining and the stocks markets are seeming to trend higher.
I would suggest that you do a ‘stress test’ on your debt to see if you can handle a 1-2% interest rate increase.
Talk to your lending specialist to make a plan.
Also, learn how Canadian Dollar futures and options can help manage your currency risk.
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