Canada Keeps Interest Rate at 2.25%, Boosting Cash-Equivalent ETFs

The Bank of Canada has decided to keep its policy interest rate at 2.25%, citing uncertainty around U.S. tariffs, Canada's economic recovery, and inflation outlook.

This decision means that Canadian investors can still earn a reasonable yield on cash without taking much investment risk.

For savers, this means they can continue to earn decent interest on idle cash for a while longer, although future rate decisions will ultimately depend on inflation and economic conditions.

Cash-equivalent ETFs can be useful alternatives to insured deposits, offering daily liquidity and monthly income without the need to lock money into a guaranteed investment certificate (GIC).