Saturday 21 October 2017

Brendan Keenan: One small cut in rates, but a giant step in global fortunes

Brendan Keenan

Brendan Keenan

WANT to know how important interest rates are? Try Canada. The Canadian government is trying to slow down a housing boom -- doing all the things we now say we wish Bertie Ahern and Brian Cowen had done.

The latest moves include limiting mortgages to 25 years; not lending more than would cost more than 40pc of buyers' income; and capping top-up mortgages to 80pc of house value.

Economists reckon the whole dramatic, and presumably unpopular, package is equivalent to a one per cent rise in mortgage rates. Changes in rates produce less drama, but they have big effects.

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