Bank of Canada Predicts Stable Interest Rates Through 2026

According to an A.M. Best analyst, the Bank of Canada is likely to hold interest rates steady for the rest of 2026.

The current interest rate of 2.25% provides a buffer, allowing the bank to assess whether recent GDP growth improvements are sustainable and if energy and tariff-related increases will spread more broadly through the economy.

Statistics Canada shows modest improvement in real GDP growth between February and July 2026. However, higher energy prices contributed to the drag on economic growth figures.

The analyst notes that inflation risks remain elevated, but lowering interest rates may not be effective in addressing external trade shocks such as oil price increases and tariffs.