While this is the third consecutive month that inflation growth appears to slow, questions remain for consumers, both in terms of real estate and food baskets.
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In an interview with the newsletter Noovo thread 17 On Wednesday, the head of the business and economics office of L’actualité magazine, Marc-André Sabourin, examined several issues related to inflation, as the key rate “risks rising again”.
What to choose as a mortgage?
The key rate hike will have a major impact on homeowners with adjustable rate mortgages or who are currently renewing their mortgage.
“Someone who has a $ 300,000 mortgage right now at a 4.5% floating rate and there is a 0.5% increase, that would be an increase of about $ 90 on the monthly mortgage payments. And that’s a an increase that adds to those who have already suffered on numerous occasions during 2022 ”, he explained.
Is it better to opt for a fixed rate mortgage? It depends “a lot on the situation of each person”, replies Mr. Sabourin.
“Historically, the floating rate is financially more attractive over the long term. That said, there is no one who can predict where rates will go next year and next year, “she said.
“The advice that mortgage lenders give is that if you can manage an increase in mortgage payments over the next few months, years, the floating rate can be attractive. But if you are tight or if the idea that the mortgage payment increases every month stresses you, it is better to opt for a fixed rate, “added the economist.
What about the shopping cart?
Although inflation fell mainly due to the price of gasoline, the prices of grocery purchased in stores recorded an increase of 11.4%, the largest since August 1981.
Private company Loblaw announced Monday that it would freeze the prices of 1,500 products sold under its private label No Name. But experts say the move is largely a PR tactic as Canadians and politicians accuse the grocery giants of profiting from rising prices.
“Ultimately, this won’t make a difference to the shopping cart bill,” Sabourin said. A basket that cost you $ 100 in September 2021 now costs you $ 114. That’s a lot and we agree that food is an essential need.
Watch the full interview in the video.
