The Bank of Canada took a step to attempt to soften the blow of COVID-19 on the economy by dropping its key rate by another 50 bps to 0.75 per cent — the second cut in as many weeks.
The Bank of Canada also took additional measures with banker acceptances to keep the short term lending market liquid, to allow Canadian businesses to weather this storm.
And it “stands ready” to make further moves, according to Stephen Poloz, governor of the Bank of Canada.
In the U.S., there are expectations that the Federal Reserve could possibly cut the fed rate by 100 bps.
“As the Bank of Canada and Federal Reserve push key rates to zero, land prices stand to benefit,” says RealAgriculture founder Shaun Haney. “At the very least, you should be talking to your banker and exploring opportunities in the middle of this COVID-19 rate cutting.”
For farmers, the current economy may provide opportunities to refinance, lock in longer-term money, find relief on interest costs with floating mortgages, or buy land.