Insights · Rates
The Bank of Canada held at 2.25%. What that means before October 28.
Seven decisions in a row with no change, and inflation near 3%. Here is what to do if you are buying, renewing or on a variable rate.
What happened
On September 2, 2026 the Bank of Canada left its policy rate at 2.25%, the seventh decision in a row with no change. The Bank pointed to inflation running near 3%, pushed up by energy prices, while the economy still has slack and unemployment is around 6.5%. The next decision is on October 28.
What it means for your mortgage
On a variable rate
Your rate follows your lender's prime rate, which moves with the Bank. A hold means no change to your rate for now. With inflation above the 2% target, do not build a budget that depends on cuts.
On a fixed rate, or choosing one
Fixed rates follow bond yields, not the Bank's announcement days, so they can move between decisions. If you close or renew within the next four months, a rate hold costs nothing and protects you if rates rise.
Qualifying
The stress test still applies to new mortgages and refinances at federally regulated lenders: your contract rate plus 2%, or 5.25%, whichever is higher.
What to do now
- Renewing within 120 days: have a rate held now, then compare.
- On a variable rate: work out your payment if prime rose by half a point and check that your budget carries it.
- Buying: have the pre-approval in place before October 28, not after.
Sources
- Bank of Canada: summary of deliberations, September 2, 2026
- TD Stories: The Bank of Canada holds its interest rate on September 2
Information only. Not mortgage, financial or legal advice. Approval, rates and products depend on lender criteria, qualification and application. O.A.C. E.&O.E.