The Bank of Canada interest rate announcement today came as expected: the central bank kept the overnight rate at 2.25%. This was the first official decision of 2026 and echoes the hold from December.
The Bank of Canada sets the policy interest rate to influence short-term financing costs for everyone — including you if you’re buying, selling, or holding property. The rate stayed at 2.25 % on January 28, 2026.
What the announcement said
The Governing Council said the current rate “remains appropriate” as long as the economy and inflation broadly match expectations. They also flagged heightened uncertainty from trade and global conditions.
Economists widely expected no change. Many also think the Bank will keep rates steady in the near term, since inflation is near target and the economy isn’t showing strong momentum.
Why this matters for your real estate decisions
A steady Bank of Canada interest rate means borrowing costs at the benchmark level aren’t rising right now. Lenders base their own rates on this benchmark, so your mortgage rates are influenced by this decision. If the Bank had raised the rate, variable-rate mortgages would likely get more expensive. If it cut the rate, there might be relief for borrowers. Holding at 2.25 % avoids both shifts for now.
That said, lenders still set their own margins. A hold doesn’t guarantee your mortgage rate stays the same. You should ask your broker or bank how their rates compare to this policy rate.
Where this ties back to the market
The Bank’s choice to hold shows caution. It suggests they see soft or modest growth with inflation around target. But they’re wary of risks ahead. That typically means they’re waiting for clearer data before making moves that affect the economy.
You don’t have to interpret the wording as optimism or pessimism. It’s realist thinking: keep the rate where it is while watching what comes next.
