Why Bank of Canada’s rates stance didn’t surprise advisors
Grant White, president and portfolio manager of Endeavor Wealth Management at IA Private Wealth, said: “I’m not surprised that they left it alone. I think the language is definitely pointing to the next meeting in March when we see interest.” Will see an increase in rates.
Although he said the bank has indicated that inflation is becoming a concern and there is a lot of speculation about where interest rates could go, he doesn’t expect them to move as fast as expected.
“I think we’re going to see growth in March, and then we’re going to go into a wait-and-see period to see how things go,” he said. “Some people are demanding four or five rate hikes this year, but I think it is going to be a little slower than that because I don’t think everything is as rosy as it might seem yet. So, I think the bank will take a cautious approach while trying to manage inflation concerns. I think we will see several rate hikes this year, but I don’t think we will see as much as some pundits are predicting right now.
While White expects interest rates to climb closer to 1% over their 0.25% overnight and deposit rates and 0.5% bank rate, he said that many advisors and investors who have entered the industry over the past 14 years have faced an ever-increasing interest rate. Haven’t seen the atmosphere. experience over the next few years. Therefore, investors need to align their portfolios accordingly and ensure that they adopt a multi-asset class approach and use alternative assets such as market neutral investments to generate consistent returns over the next few years.
Jackie Porter, president and founder of Team Jackie Porter in Toronto, said: “Everyone, including the market, is breathing a sigh of collective relief because I think unfortunately, Canadians, in general, and business owners are getting used to cheap money. It has happened, and it is a very dangerous thing.”