2025 saw the Bank of Canada use a mix of rate holds and rate decreases as they worked to handle international trade relations and tariffs imposed by the United States. Over the course of 2025, the Bank of Canada lowered their key rate 1% from 3.25% to 2.25% through four separate 25 basis point decreases.
To start 2026, the Bank of Canada announced their hold their rate at 2.25%. This was the second consecutive hold decision with the last rate cut coming in October of 2025.
Bank of Canada Governor Tiff Macklem opened with this, "Our forecast for economic growth and inflation in Canada has not changed significantly since our October projection. As the Canadian economy continues to adjust to US trade restrictions, we expect GDP to grow modestly and inflation to stay close to the 2% target." (Bank of Canada, 2026)
Macklem also discussed the the aim of this and future decisions, "Our monetary policy decisions are focused on keeping inflation close to the 2% target while helping the economy through this period of structural change. Governing Council judges the current policy rate remains appropriate, conditional on the economy evolving broadly in line with the outlook we published today. With heightened uncertainty, we are monitoring risks closely. If the outlook changes, we are prepared to respond." (Bank of Canada, 2026)
The Bank of Canada's next rate announcement is scheduled for Wednesday, March 18, 2026, with the schedule for the remaining decisions for 2026 below.
Graph Courtesy: Bank of Canada; https://www.bankofcanada.ca/core-functions/monetary-policy/key-interest-rate/
Quotes Courtesy: Bank of Canada; https://www.bankofcanada.ca/2026/01/opening-statement-2026-01-28/
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