Bank of Canada Seen Holding Rate at 2.25% Through 2026 Despite 2.8% Inflation
Updated
Updated · Reuters · Jun 5
Bank of Canada Seen Holding Rate at 2.25% Through 2026 Despite 2.8% Inflation
3 articles · Updated · Reuters · Jun 5
Summary
All 34 economists in a June 2-5 Reuters poll expect the Bank of Canada to leave its overnight rate at 2.25% on June 10, with 28 of 34 seeing no change for the rest of 2026.
April inflation rose to 2.8% from 2.4% as the U.S.-Israeli war with Iran lifted energy prices, but core inflation eased and economists said weak demand leaves little case for a hike.
The hold view comes after the BoC cut rates by 275 basis points between June 2024 and October 2025, while Canada slipped into a technical recession even as May job gains offered some relief.
Markets still price in one rate hike by end-2026, and more than 40% of economists expect tightening in early 2027 if oil-driven inflation proves persistent and trade uncertainty with the U.S. worsens.