Doug Ford once again calls on Bank of Canada to lower interest rates

July 23, 2024 Canuck

Premier Doug Ford is once again calling on the Bank of Canada to lower interest rates.

Ford took to social media on Tuesday to make his case that the central bank should cut its key lending rate for a second consecutive meeting tomorrow, arguing that doing so is the “best way to boost the economy and “give people stuck with sky-high mortgage rates some relief.”

“People in Ontario and across Canada need help,” Ford said in a post on X.

Economists are widely expecting the Bank of Canada to cut its key lending rate by another 25 basis points to 4.5 per cent on Wednesday.

However, it is unlikely that doing so will have an immediate impact on a real estate market that has slowed considerably since the Bank of Canada began hiking rates from a pandemic-era low in March 2022.

The bank ended up raising rates on 10 separate occasions, pushing its key lending rate to a 22-year high in the process.

Speaking with reporters at a news conference in Kitchener on Monday, Ford said that Bank of Canada Governor Tiff Macklem needs to keep cutting rates in order to help with the construction of new homes in Ontario.

Ford’s comments come just days after a report by real estate industry research group Urbanation revealed that new condo sales in the Greater Toronto and Hamilton Area plummeted to a 27-year-low during the first six months of 2024, largely due to a “sharp downturn in construction starts.”

“Folks, you want to build homes? If we get the Bank of Canada to knock rates down to around three per cent they will pop up like mushrooms everywhere,” Ford said on Monday. “I can’t help myself with this but the Bank of Canada they need to continue cutting these rates. It is absolutely essential. We are fighting, all Ontarians, are fighting to keep the economy going. They are on the other side trying to slow down.”

The Bank of Canada has previously insisted that it was necessary to significantly raise interest rates after inflation surged to a high of 8.1 per cent coming out of the COVID-19 pandemic.

Last week, Statistics Canada revealed that the inflation rate was down to 2.7 per cent in June.

Canada’s unemployment rate has also been steadily rising, reaching a recent high of 6.4 per cent last month.

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