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Canada’s Commercial Banks Lift Their Prime Lending Rates To 6.70%

Following the Bank of Canada’s latest interest rate increase, commercial banks throughout the country have raised their prime lending rates by 25-basis points to 6.70%.

The Royal Bank of Canada (RY), Toronto-Dominion Bank (TD), Bank of Montreal (BMO), Canadian Imperial Bank of Commerce (CM), Bank of Nova Scotia (BNS) and other lenders each lifted their prime rates in response to the central bank’s latest interest rate increase.

Prime lending rates are used to determine the amount of interest that is charged on loans to consumers, ranging from mortgages to home equity lines of credit (HELOCs).

Canada’s central bank boosted its benchmark interest rate by 25-basis points to 4.50% on January 25 as it continues to try and bring inflation that’s currently at 6.3% back down to its 2% target.

Canada’s big banks have followed the central bank’s moves on interest rates in lockstep for the past year.

Prime lending rates at Canada’s commercial banks have now risen to 6.70% from 2.45% on March 2, 2022, the day the Bank of Canada began its current interest rate hiking cycle.