Bank of Canada

We'll hear from Cam Dahl on that.

The Bank of Canada's trend-setting interest rate has remained steady at 2.25% since November of last year.

However, long-term fixed interest rates have been rising due to higher bond yields.

Kevin Hirsch of sascagtoday.com will have a report for us on that.

It's cloudy and 15 degrees in the Yorkton-Melville region.

I'll have your complete weather details coming up at the top of the hour.

The Bank of Canada's trendsetting interest rate has remained steady at 2.25% since November of last year.

However, long-term fixed interest rates have been rising due to higher bond yields.

... you know, five or 10.

Uh, and then at the same time, I think overnight rates, that's where it's like, what the heck is a squirm we're going to do here? 'Cause I think they are coming, they, a- as you mentioned a few moments ago, Ben, like, we're, we're potentially headed into this incredibly volatile experience right now, where the Bank of Canada will have to decide whether, hey, maybe we should raise rates 'cause prices of everything is going higher, or they could say, oh boy, credit is starting to deteriorate, and they cut rates, or they don't hike.

Then at the same time, you have prime rate on top it.

You can, I can s- see in a scenario where the Bank of Canada does not hike, but prime goes higher 'cause commercial banks are afraid of credit.

I just think things are so uncertain right now in, in that space.

But the, uh, the betting man would say, hey, long-term rates are going higher.

[laughs]

Yeah, look at-

Everything that couldn't be produced locally had to come from somewhere else: weapons, wine, paper.

And according to David Bergeron, curator at the Bank of Canada, perhaps most importantly for our story, money.

There was a struggle to try to determine what could be used as money and beyond what was, uh, the official currency used in Canada based on the French, the French, uh, livre, which was, of course, the unit of account or the money of account for the colony, uh, at the time.

In France, money traveled through an established economy.

Like, maybe they'll give us something better.

But this is what I've been trying to say for ages, and Mark Carney should know this better than anyone, 'cause he was Bank of Canada governor during the, the Brexit malarkey.

The European Union is not particularly generous with countries outside of the European Union.

You know? They are ultimately a, a trading block.

Our inflation is well-teamed.

Our Bank of Canada is likely going to be on hold.

I don't see any pressure for the interest rate in Canada to go up.

So why are the utilities' share prices in Canadian and Canadian utilities rising? Shouldn't they be on hold or or not falling the way they are anyway.

When you got TRP with a 6% growth rate trading around 23 times on July 17th, it just got overdone.

So, of course, there's going to be some interest rate gyrations when we're, you know, when the U.S. is going to be raising rates two or three times.

And if they raise rates two or three times, I think Bank of Canada is going to be probably raising a little bit anyway.

Maybe not quite as much, but somewhat.

Canadian CPI will be closely watched following renewed trade frictions between Canada and the United States.

A hotter-than-expected reading could increase expectations for another Bank of Canada rate hike, potentially supporting the Canadian dollar.

On Tuesday, crypto traders will have their eye on the Senate, which will vote on the Clarity Act.

This is a procedural vote, however, and as there are still several issues lingering, its outcome will be crucial for whether the Senate will proceed with a final vote on the bill this year or not.

Um, because, uh, if the economy slows and, and, and, and the tariffs and all the uncertainty weaken our economic momentum, uh, then that becomes disinflationary.

And it's important to remember, the Bank of Canada cares just as much about below target inflation as it does about above target inflation.

Um, uh, the bank had said, uh, uh, at, at two meetings ago that it would be willing to cut rates again i- if, i- if there were new US trade actions that, that were deleterious, and, and we got those.

So, um, I thought all else being equal...

Japan is now facing inflation it hasn't seen in a long time because it is so energy dependent.

It imports about 90% of its energy, and, um, uh, all of a sudden, uh, that being a, a, a source of a downward pressure on global yields, um, is turning the other way.

And the bottom line is yields are spiking, fixed rates are rising, and the Bank of Canada is sounding a lot more hawkish.

So if you've got a variable mortgage rate, you're paying a lot of attention to what the Bank of Canada is saying, 'cause if the bank moves its policy rate, the variable mortgage rates change.

They lose money because tariffs raise costs, reduce access to markets.

The Bank of Canada, by the way, has already estimated that the U.S. tariffs and the resulting trade disruption with Canada is going to cost our GDP about 1.5%.

It's going to be 1.5% below we're expected to be by the end of this year compared with its January forecast.

And the pain isn't distributed equally between provinces and industry.

And, um, we saw that, I think the bank of Japan did that.

The ECB has just done that, I think today.

And, um, that, that, could be a trend which follows the Federal Reserve and the Bank of Canada as well.

We'll see.