Bank of Canada Predicts 'Hold Then Hike' Interest Rate Strategy

TD Securities analysts are predicting that the Bank of Canada will maintain its current policy rate before implementing a hike later in 2025.

The forecast is based on persistent underlying inflation and a resilient domestic economy, which suggests the central bank will prioritize data confirmation over a rapid easing cycle.

The primary factor behind the 'hold then higher' call is the Bank of Canada's need to balance cooling headline inflation against sticky core price pressures.