Bank of Canada Holds Policy Rate at 2.25%
The Bank of Canada maintained its overnight policy rate at 2.25%, with the Bank Rate remaining at 2.5% and the deposit rate at 2.20%.
Canada’s economy grew by 3.3% in the second quarter, supported by consumption, exports, business investment and a rebound in housing activity. However, the Bank cautioned that some of this strength reflected temporary factors. Inflation remains near 3%, driven largely by gasoline prices, while inflation excluding gasoline stood at 2.2% in July.
The Bank said elevated energy prices, new U.S. tariffs and Canadian countermeasures have increased uncertainty and could threaten the economic recovery. For rental housing providers, the continued rate hold provides near-term stability, although elevated bond yields and inflation risks could keep borrowing and refinancing costs under pressure.
View full statement at: Bank of Canada interest rate announcement