Did you know about the Overnight Lending Rate?

Every couple of months we read or hear on the news whether the Bank of Canada overnight lending rate has changed. This rate is also called the Key interest rate for the Bank of Canada. They assess the rate 8 times a year. This is the rate which the banks use to borrow from each other "Over-night". Kind of like when you run out of sugar for your apple pie so you ask your neighbour to lend you some. The rate has been top of mind for some people because the rate was at 1% for about 5 years  and has been lowered twice in the last few months and is now .5%. Although this rate influences what the banks charge us when we buy a house the mortgage rates do not directly follow this rate. 

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