Prime rate coming down again?

The Bank of Canada is expected to cut its overnight interest rate by 25 basis points next week. The Bank of Canada will make its interest rate announcement on Tuesday, June 10, 2008. Most economists expect the target for the key overnight rate to be set at 2.75 per cent, down from 3 per cent. But some analysts are saying that the inflation threat will make the Bank of Canada think twice about how far it is willing to cut interest rates.

Big banks usually follow the Bank Of Canada and drop their prime lending rate. The last time they were not so quick to accounce the reduction in prime rates. Let's see how the big 5 will react this time if Bank Of Canada cuts the overnite lending rate by 0.25%.

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