Bank of Canada Holds Rates - What It Means for Borrowers
The Bank of Canada announced this week that it’s keeping its overnight rate at 2.25%, maintaining the same level for now.
This “stay-the-course” approach reflects the Bank’s view that inflation is under control and the economy is stabilizing after a period of slower growth.
Why the Bank is holding steady
Economic growth in Canada came in stronger than expected last quarter, largely due to trade fluctuations, even though domestic spending stayed flat. Employment has been improving slightly, and inflation - now at around 2.2% - is close to the Bank’s 2% target.
In simple terms, this means the Bank doesn’t see a strong reason to raise or cut rates just yet.
What this means for borrowers
If you have a variable-rate mortgage, your rate and payments are likely to stay the same for now. For those shopping for a home or renewing soon, fixed mortgage rates will continue to depend on bond yields - which haven’t changed much recently. So while the Bank’s decision doesn’t directly lower fixed rates, it does help keep borrowing conditions stable and predictable.
If you are like me, and you like to look at numbers, here is a table summarizing the Prime Rate changes in Canada from 2010 to today:
| Effective Date | Prime Rate | Change |
|---|---|---|
Dec 10, 2025 | 4.45% | 0.00% |
Oct 29, 2025 | 4.45% | -0.25% |
Sept 17, 2025 | 4.70% | -0.25% |
July 30, 2025 | 4.95% | 0.00% |
June 04, 2025 | 4.95% | 0.00% |
April 16th, 2025 | 4.95% | 0.00% |
| March 12th, 2025 | 4.95% | -0.25% |
| Jan 29th, 2025 | 5.25% | -0.25% |
| Dec 11th, 2025 | 5.45% | -0.50% |
| October 23, 2024 | 5.95% | -0.50% |
| Sept 4, 2024 | 6.45% | -0.25% |
| July 24, 2024 | 6.70% | -0.25% |
| June 5, 2024 | 6.95% | -0.25% |
| July 12, 2023 | 7.20% | +0.25% |
| June 8, 2023 | 6.95% | +0.25% |
| January 25, 2023 | 6.70% | +0.25% |
December 8, 2022 | 6.45% | +0.50% |
| October 27, 2022 | 5.95% | +0.50% |
| September 8, 2022 | 5.45% | +0.75% |
| July 14, 2022 | 4.70% | +1.00% |
June 2, 2022 | 3.70% | +0.50% |
April 14, 2022 | 3.20% | +0.50% |
| March 3, 2022 | 2.70% | +0.50% |
| March 30, 2020 | 2.45% | -0.50% |
| March 17, 2020 | 2.95% | -0.50% |
| March 5, 2020 | 3.45% | -0.50% |
October 25, 2018 | 3.95% | +0.25% |
| July 12, 2018 | 3.70% | +0.25% |
| January 18, 2018 | 3.45% | +0.25% |
| September 7, 2017 | 3.20% | +0.25% |
| July 13, 2017 | 2.95% | +0.25% |
| July 16, 2015 | 2.70% | -0.15% |
| January 28, 2015 | 2.85% | -0.15% |
| September 9, 2010 | 3.00% | +0.25% |
| July 21, 2010 | 2.75% | +0.25% |
| June 2, 2010 | 2.50% | +0.25% |
Looking ahead
The Bank signalled it’s ready to respond if inflation rises again or global uncertainty worsens, but for now, it’s focused on keeping price stability and supporting steady growth.
The next rate announcement is scheduled for January 28, 2026, and all eyes will be on whether the Bank sees enough progress to consider future cuts.
Need help understanding how this affects your mortgage?
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