Bank of Canada to Hold Interest Rates Through 2026
A Reuters poll shows economists expect the central bank to keep rates at 2.25 percent. While energy prices are rising, a weak economy allows for policy patience.
The central bank of Canada is expected to maintain its current monetary policy through the end of the year, according to a recent Reuters poll of economists. Despite escalating geopolitical tensions involving Israel and Iran, the majority of experts believe the overnight rate will remain at 2.25% during the upcoming meeting on April 29 and throughout 2026.
While financial markets have begun pricing in a potential rate hike for the fourth quarter, analysts suggest such a move would only be triggered if a spike in energy costs, particularly for Brent Crude Oil, leads to entrenched inflation. Currently, the Canadian economy faces a slack labor market and cooling growth, which provide a counter-argument to tightening. March inflation figures sat at 2.4%, comfortably within the central bank's target range.
