The Bank of Canada has increased its policy interest rate by 50 basis points, which now stands at 3.75%.
Bank of Canada
|Royal Bank of Canada Prime Rate|
Effective Thursday, October 27th 2022
- Click here to consult the press release issued by the Bank of Canada. You may also consult the latest Monetary Policy Report.
- The next Bank of Canada announcement will be on December 7, 2022.
How does this impact you and your clients?
Don't miss next Tuesday's edition of the IN YOUR INTEREST! podcast, where Sébastien Mc Mahon, our Chief Strategist and Senior Economist, will discuss this latest increase and it's impacts.
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Impact on savings and life insurance loans
On the savings side, as stipulated in the loan agreement, this increase will automatically impact the payments to be made by your clients with previously issued loans (RRSPs, RESPs and investment loans) as these loans are established according to the Royal Bank of Canada's prime rate which now stands at 5.95%*.
In addition, since iA Financial Group also uses this rate to establish policy loans on certain individual life insurance policies, these loans could be affected.
These adjustments are automatic, no action is required on your part, nor on your client's part.
Increased rate for the High Interest Savings Account (HISA)
In addition to providing security against volatility, the High Interest Savings Account (HISA) offers a better return in a rising interest rate environment! The HISA rate increases to 3.35% on Friday, October 28th, 2022.
A simple, accessible and risk-free alternative!
* The annual interest rate changes automatically, without notice, whenever the prime rate changes.