The Bank of Canada raises its rate to 2.5%
- 2.50%New policy rate
- +0.25%Change
- Dec 9Next announcement
On October 28, the Bank of Canada raised its policy rate by a quarter point to 2.5%, its first increase since July 2023. The Bank pointed to persistently high oil prices pushing up costs across the economy. It expects inflation to reach about 3.5% by the end of the year, and said further increases are possible, though it will move carefully.
If you have a variable-rate mortgage or a line of credit, expect your rate to rise as lenders adjust their prime rates. Check whether your payment changes or more of it goes to interest.
If your renewal is in the next six to twelve months, now is a good time to review your options. Many lenders let you hold a rate for up to 120 days, which can protect you if rates keep climbing.
If you're buying, get your pre-approval in place so your rate is locked while you shop.
Source: Bank of Canada, October 28, 2026