When we talk to clients about planning for 2026, the goal is not to predict what the market will do next. It’s to help people understand how their mortgage works, how it might behave if conditions change, and whether it still feels comfortable across different outcomes.

The Bank of Canada announced a 25 basis point rate cut, lowering the overnight rate to 2.50%. The Bank Rate is now 2.75% and the deposit rate is 2.45%. The Bank of Canada rate cut September 2025 directly affects variable mortgages and influences lender pricing for fixed options.

This marks the first time in a full year that the central bank has chosen not to cut rates, following a 225-basis-point reduction since June 2024. The move surprised many, as economists remained split heading into the April 16 announcement, weighing sluggish employment data and housing activity against escalating global trade tensions.