Rate Pause at 2.75%: What the Bank of Canada’s April Hold Signals for Borrowers

After months of aggressive rate cuts, the Bank of Canada held its key interest rate at 2.75%—a pivotal pause that could signal the start of a new phase for Canadian borrowers.

Tiff Macklem, Governor of the Bank of Canada, during a January 2025 press conference. His earlier remarks laid the groundwork for the central bank’s April decision to hold the policy rate at 2.75 percent.

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.

While inflation fell to 2.3% in March, the Bank noted several contributing forces at play—ranging from the elimination of the consumer carbon tax to rebounding goods prices and volatile global oil markets. The hold reflects a wait-and-see approach, as policymakers assess whether newly imposed tariffs from the U.S. will destabilize Canada’s economy further.

“Governing Council will proceed carefully, with particular attention to the risks and uncertainties facing the Canadian economy,” the BoC stated.

What This Means for Mortgage Holders and Homebuyers

Despite softening home prices in some markets and growing supply, the cost of borrowing remains elevated. If you’re renewing or shopping for a mortgage, this pause doesn’t yet unlock lower rates—but it could mark a turning point.

Here's what we’re watching closely:

• Bond yields are still trending downward, which may pressure lenders to reduce fixed rates in the coming weeks.

• Variable-rate borrowers may not see immediate relief, but the pause buys time for households feeling the strain.

• Investor sentiment remains cautious, especially in light of tariffs and slowed capital investment from the business sector.

What Comes Next: 2025 Rate Schedule

The Bank’s next announcement is scheduled for Wednesday, June 4. Key dates to track for the rest of the year include:

• July 30

• September 17

• October 29

• December 10

Each decision will weigh the trajectory of inflation, job growth, trade policy, and housing market performance.

Seventy Seven Park’s Perspective

At Seventy Seven Park, we believe preparation beats prediction. Whether rates go up, down, or hold steady, the best strategy is one built around your goals, your income, and your timeline. We’re here to help you structure the right mortgage—whether you're buying, renewing, or refinancing.

Need support in today’s rate climate? Let’s get your application started.

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