Banks raise prime rates after Bank of Canada hike


Lenders raise rate 75 basis points to 5.45%

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Major Canadian banks have increased their prime lending rates by 75 basis points to 5.45 per cent in response to the Bank of Canada’s move Wednesday to raise its key policy rate to 3.25 per cent.

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Toronto-Dominion Bank, Royal Bank of Canada, Canadian Imperial Bank of Commerce, Scotiabank, Bank of Montreal and National Bank of Canada all had their prime lending rate at 4.70 per cent prior to the announcement.

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The new prime rates come into effect Thursday. The hike in prime lending rate at Canadian banks indicate a higher starting point for lenders’ loan calculations.

The banks’ announcements come after the central bank hiked interest rates 75 basis points on Wednesday, the fifth consecutive increase since it started tightening in March.

The central bank said more hikes are on the way to tame inflation that continues to be too widespread in the economy.

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