Bank of Canada Holds Policy Rate Steady

On Wednesday, the Bank of Canada held its target for the overnight rate at 2.25%, keeping the Bank Rate at 2.5% and the deposit rate at 2.20%, Yahoo Finance reported (1-28-26). The decision follows a similar hold at the Bank’s December 2025 meeting.

In its statement, the Bank said the current policy rate “remains appropriate” given existing economic conditions. However, comments from Governor Tiff Macklem suggested uncertainty around the timing and direction of future moves.

“While Council judges the current policy rate is appropriate based on our outlook, the consensus was that elevated uncertainty makes it difficult to predict the timing or direction of the next change in the policy rate,” Macklem said.

The Bank’s updated economic outlook, published in its latest Monetary Policy Report, was described as “little changed” from the projections released in October. The statement cautioned, however, that the outlook “is vulnerable to unpredictable US trade policies and geopolitical risks.”