Bank of Canada

4 in 10 Say If Interest Rates Rise They Could Be in Financial Trouble

Four in 10 Canadians say that if interest rates rise any more, they fear they’ll be in financial trouble, according to a poll as reported by CTV.

One in 3 Canadians say they’re already feeling the effects of rising interest rates.

This poll comes after the Bank of Canada raised its key interest rate target twice this year. Consequently, big banks raised their prime lending rate, pushing the cost of the variable-rate mortgages and other loans such as home equity lines of credit that are tied to the benchmark rate.

The Bank of Canada is supposed to make another bank announcement Wednesday, but economists don’t expect change to its rate target.

Borrowers with fixed-rate mortgages will have seen no change in the cost of their loans, but rate for new fixed-rate mortgages and people wanting to renew their mortgages have raised interest rates.

In the survey, 7 in 10 Canadians say that higher interest rates will make them be more careful with how they spend their money.

Canadian debt levels are the highest they’ve ever been, and high housing prices are a driving factor.