RateHub Roundup: February 2017

Jane Switzer
by Jane Switzer February 6, 2017 / No Comments

It certainly hasn’t been a slow start to 2017. As a new U.S. president takes office, the Brexit’s aftermath unfolds, and Canada’s housing market continues to scorch, the coming year promises to be full of changes both at home and abroad. Here’s our roundup of news you might have missed in January:

Economic policy in Donald Trump’s America 

Okay, you probably didn’t miss this one: since the inauguration of U.S. President Donald Trump on Jan. 20, there’s been speculation aplenty about how his proposed fiscal and trade policies will play out. Where to begin? He’s already signed executive orders to suspend immigration from seven Muslim-majority countries, withdraw the U.S. from the Trans-Pacific Partnership, build a wall along the U.S.-Mexico border, reboot the Keystone XL pipeline project, and of course, there’s his very vocal criticisms of the North American Free Trade Agreement. Stay tuned for what promises to be four years of Americans threatening to move to Canada.

Bank of Canada holds key interest rate

Canada’s central bank announced Jan. 18 it’s keeping its key interest rate at 0.50%. According to analysts, it’s likely to stay that way until 2018, as there’s still “significant slack in the labour market” compared to the U.S. The bank didn’t comment specifically on Trump’s election, but noted in its latest monetary policy report that its modestly upbeat outlook for Canada’s economy doesn’t account for the “full range” of policy changes the new president could enact. The bank’s next interest rate announcement is scheduled for March 1. South of the border, the U.S. Federal Reserve announced Feb. 1 it’s holding steady its own benchmark interest rate at in the range of 0.50% to 0.75% as economic confidence increased and unemployment remained low.

B.C. softens rules on foreign buyer tax

In a bid to draw skilled workers to the province, the British Columbia government has relaxed the rules of its controversial foreign homebuyer tax. Introduced abruptly last August, the 15% tax levied on homes in Metro Vancouver purchased by foreign nationals is aimed at reducing both Vancouver’s notoriously insane real estate prices and competition for available housing. The new rules exempt “people who have work permits who are paying taxes and living in British Columbia,” according to B.C. Premier Christy Clark. Permanent residents were already spared. Apparently, the tax is working: prices decreased 2.2% in the second half of 2016 to a composite benchmark price of $897,600, according to the Real Estate Board of Greater Vancouver. However, don’t get your hopes up too high that Vancouver will ever be considered affordable again. As one economist told the Vancouver Sun, “We are never going to be cheap.” 

CBC’s Go Public calls out sketchy credit card signup practices

This story is a must-read for consumers. The CBC published an unsettling interview with former employees of SDI Marketing, who allege management pressured them to use “whatever means necessary” to get people shopping in Loblaws-owned stores to sign up for President’s Choice Financial credit cards — including misleading or tricking customers into thinking they were only signing up for free PC Points or a free bag of cookies.

My advice? If you’re approached, walk away. You came into the grocery store to buy lunch food and restock on paper towels — even if you know you’re signing up for a credit card, there’s no situation where it’s advantageous for you to walk out with one you signed up for on the spot. If you’re considering a new card, you should compare the best credit cards before making a decision so you can find the one best suited to your income level and spending habits.

Walmart ends Visa ban in Canadian stores

Walmart Canada and Visa ended their months-long game of chicken over what the retailer called “unacceptably high” credit card merchant fees, allowing Visa credit cards to continue being accepted at Walmart’s 409 Canadian stores. The retailer first stopped accepting Visa cards at its three locations in Thunder Bay, Ont., in July, and later at all 16 stores in Manitoba, threatening to expand the ban country-wide if Visa didn’t lower the merchant fees it charges for each credit card transaction. Neither Walmart nor Visa would disclose the terms of their agreement.

RateHub updates

How can Canada’s big banks improve their relationships with fintech companies? RateHub’s chief marketing officer Kerri-Lynn McAllister outlines three ways the major players can embrace the reality of digital disruption and position themselves better for collaboration.

It’s hard out there for a first-time homebuyer. This RateHub infographic shows a significant chunk of Canadians across the country need a financial helping hand to break into in the red-hot housing market.

New year, new credit card reviews: we’ve evaluated the best credit cards in Canada for 2017. You should also check out our complete best-of series for the top cash back, travel rewards, no fee, low interest, and balance transfer credit cards.

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