The Bank of Canada’s last interest rate update of 2025 is on the way

The Bank of Canada is scheduled to deliver its final rate announcement Wednesday morning, which will determine if some borrowing costs in Canada will change or stay put.

The Bank of Canada is scheduled to deliver its final rate announcement of 2025 on Wednesday morning, which will determine if some borrowing costs in Canada will be cut, stay at current levels or increase.

Most economists expect the central bank to hold its key policy rate at 2.25 per cent, after recent reports on the economy were somewhat positive.

This included recent gauges on economic output, or gross domestic product; consumer inflation, or the consumer price index; and the Labour Turnover survey showing unemployment ticking down for the second straight month.

At least one economist thinks that if the bank makes any changes in the near future, it won’t be a cut, but actually a hike in the second half of 2026.

“Nobody expects the policy rate to change today. No change is priced until markets begin to seriously toy with a hike by summer into fall,” Derek Holt, vice-president and head of capital markets economics at Bank of Nova Scotia, said in a statement.

“A great deal of uncertainty lies ahead into 2026, which cuts in both directions to our (Bank of Nova Scotia’s) expectations.”

Governing members at the Bank of Canada have opted to cut interest rates four times so far this year, including at the September and October meetings. That was after holding rates for three straight meetings in April, June and July, and cutting rates in January and March.

Following the October rate cut, Bank of Canada governor Tiff Macklem said that at 2.25 per cent, the current rate is “at about the right level.”