US EditionBank of Canada holds key interest rate at 2.25 per cent
The Bank of Canada kept its rate at 2.25% for the third time, balancing slower growth and risks of inflation from rising global energy prices due to the Middle East conflict.
- Holding the overnight rate at 2.25 per cent, the Bank of Canada announced on March 18, 2026, with the Bank Rate at 2.5 per cent and the deposit rate at 2.20 per cent.
- Amid a slowing domestic economy and higher energy costs, Canada's GDP contracted 0.6 per cent last year while Statistics Canada reported the labour market shed over 100,000 jobs in early 2026.
- Governor Tiff Macklem said, 'As the outlook evolves, we stand ready to respond as needed,' emphasizing the Bank's focus on inflation measures close to 2 per cent.
- Commercial banks and other lenders set loan rates based on the Bank of Canada's benchmark, so the hold directly shapes borrowing costs for Canadians while the Bank will update forecasts on April 29, 2026.
- Governor Tiff Macklem described the situation as a 'dilemma', with U.S. trade uncertainty softening growth and the Iran war pushing global oil prices up, risking inflation and economic weakness.
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54 Articles
Bank of Canada keeps policy rate at 2.25 pct
OTTAWA, March 18 (Xinhua) -- The Bank of Canada on Wednesday announced that it will maintain its target for the policy rate at 2.25 percent, amid heightened global economic risks stemming from the conflict in the Middle East. Read full story
The decision was the third consecutive that Austria maintains the juries.
Canada's central banks holds rate steady, says war will raise inflation
Read: 2 min Canada’s central bank held its key lending rate at 2.25 per cent on Wednesday, but warned the Middle East war will cause an inflation spike that may require action. The decision marked the third consecutive hold by the Bank of Canada, which has said it wants to keep rates steady while the future of U.S.-Canada trade is clarified. But the war in the Middle East triggered by U.S. and Israeli strikes on Iran has injected fresh uncertain…
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