Canadians are watching closely as the Bank of Canada prepares to announce its final interest rate decision of 2025 on Dec. 10. Homeowners and borrowers are wondering: Will rates drop again?
Most experts think the bank will hold rates steady. The overnight lending rate is currently 2.25%, having been lowered in October, and is often used by lenders to set mortgage and loan rates.
Mortgage expert Penelope Graham says the bank seems comfortable with the current rate, aiming to support the economy while keeping inflation in check. Other analysts note that predictions of another cut—down to 2% or even 1.75%—now seem unlikely this year or early 2026.
Still, some economists aren’t ruling out a future cut. TD Bank’s Maria Solovieva points out that Canada’s economy bounced back in the third quarter, even though business investment and household spending slowed. She says a rate drop isn’t off the table, but GDP would need to cool further.
Inflation is another big factor. Canada’s inflation rate sits at 2.5%, slightly above the bank’s 2% target. Experts say this makes a rate cut less likely for now, but it also doesn’t suggest an increase.
Job numbers also play a role. Statistics Canada reported that employment rose in November, with gains in part-time work, health care, food services, and natural resources.
Canadians will find out on Dec. 10 whether rates stay put—or if the bank has a surprise in store.
(Source: InsideHalton)
Stay ahead with the latest stories from Brampton and across Canada—only on Brampton-News.com.
