Bank of Canada cuts rate another half point to a record low 0.5 percent

Canada's central bank cut its key lending rate to its lowest level ever today to 0.5 percent to counter record job losses and an economy shrinking at the fastest pace in almost two decades.

Continued weakness in global markets and a deep downturn in the global and Canadian economies has tipped the balance toward further rate cuts. Canada's big banks are expected to follow today's rate cut and lead to even lower borrowing rates for potential Vancouver home buyer's and homeowners renewing their mortgages. This is great news for those homebuyer's looking to get into the Vancouver real estate market as affordabiltiy continues to be a problem even with declining home prices.

The cut is in a large part aimed at providing public perception that the Bank of Canada is doing what they can to help with the economy. The cut will also help to keep the value of the Canadian dollar low, which in turn will maintain lower prices for Canada's exported goods. A lower Canadian dollar also help's improve the revenue return for Canada's resource producers.

The positive affect of the reduced interest rates - plus the impact of economic stimulus packages by governments in Canada, the United States and elsewhere - will begin to be more visible in the second half of this year and will build through 2010.

For more information on the how these rate cuts can help you as a current or potential homeowner in the Vancouver real estate market contact Vancouver Realtor Dean Wegman by clicking here. To read more about Vancouver real estate market conditions in 2009 click here.  

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