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Towards lower interest rates before the end of the year?

Economist Philip Josselin estimates that we may see a drop in interest rates by the end of the year or the beginning of next year.

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In an interview with the program “Le Bilan”, he explained that inflation could, slowly but surely, gradually decrease by the summer and thus avoid a possible recession.

If so, prices will stabilize in late 2023 or early 2024.

“I wouldn’t give out personal financial advice online,” he says. But there is certainly a strong possibility that the current rate will be revised downward, if not at the end of 2023, then it will certainly be in 2024.

However, the next few months could still be difficult for those who have to renegotiate their rates.

“Canadian households that have not yet renewed their rate since March 2022, are going to go to the bank maybe in the coming months and find that there is a good spread between the rates we practiced during the pandemic. And those that are now the norm at large financial institutions.

The expert also commented on keeping the main interest rate at 4.5% by the Bank of Canada, which he sees as positive in terms of inflation.

“By the summer we should be within the range from 1 to 3%, which allows us to imagine a form of ‘relaxation’ of the main rate by the end of the year. 2023,” the expert comments.

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Thus stagnation can be avoided.

“We’re living in a really endemic situation, with very few workers needed, and so that means that even if the economy slows down, workers remain employed, continue to earn a good living, and are therefore able to participate fully in the economy,” Joslin explains. . This means that most serious economists believe that we will be able to avoid a recession.

But he warns that “on the other hand, it’s not going to be a strong growth year, so we’re likely to only see a growth rate of around 1% of GDP.”

Watch Frances Josselin’s full explanations in the video above