Newly-installed Finance Minister Joe Oliver says he is keeping a watchful eye on the housing market as one of the big banks slashed its five-year mortgage rate, reports The Globe and Mail.

In a similar move executed last year, the Bank of Montreal forced an intervention from Oliver's precedessor, Jim Flaherty, when they dropped their five-year mortgage rate to 2.99 per cent.

“Our government has taken action in the past to reduce consumer indebtedness and the government’s exposure to the housing market,” Oliver said in a statement. “I will continue to monitor the market closely.”

Exactly one week after Flaherty's monumental decision to step down, BMO offered five-year fixed-rate mortgages at 2.99 per cent, a significant decrease from the usual rate of 3.49 per cent. 

Although 2.99 per cent is not the lowest rate in the market, BMO is the first of the Big Five banks to offer mortgages with rates below the Bank of Canada's prime rate of 3 per cent.

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