Bank of Canada has lowered its target for overnight interest rate to 1 per cent
The Bank of Canada lowered the overnight lending rate by .5 per cent to 1.0 per cent which is a total decrease of 3.5 per cent since December 2007. It is expected that the rate will lower even further after the next Bank of Canada announcement in March.
The rate was lowered in an effort to boost our economy which is expected to contract by 1.2 per cent in 2009.
Most banks are expected to lower their prime rate to 3%. The prime rate is the rate that the banks give to their best corporate borrowers and is the base for lending for everything from mortgages, lines of credit, consumer loans and car loans.