Ask your bank why!
When the Bank of Canada cuts interest rates, it does so in an effort to jumpstart the economy by making it cheaper for consumers and companies to borrow money.
The central bank cut its rate by a quarter percentage point last Wednesday, the second such increase this year for a total of .5%.
It passed on that cut by only .3% … so a total of a .50 reduction by the Central bank to our fine banks … resulted in only a .30 reduction in mortgage and credit lines and all variable loans – the rest into profits for banks.
So: on a $400,000 mortgage in Vancouver you should have saved $2,000 a year by now. What you are saving is $1,200. The other $800? The banks keep it.
How does that jumpstart the economy?