In July, The Bank of Canada raised its overnight lending rate for the first time in seven years, and there is the possibility of another rate hike in October. How do these rate increases affect you? Let’s take a look.

Increased Cost of Borrowing

If you borrow any money at a variable rate, the interest amount you pay goes up. Anyone with variable rate mortgages, loans or lines of credit would have noticed this increase last month, as banks are quick to raise the rates they charge for borrowing when the Bank of Canada increases rates.