🏦 Bank of Canada Interest‑Rate Decision: July 30, 2025
Today at 6:45 am Pacific Time, the Bank of Canada (BoC) announced it is holding its overnight policy rate at 2.75%, marking the third straight pause following aggressive rate cuts since mid‑2024
🔍 Why the BoC Is Holding Rates
Several key factors influenced today’s decision:- Inflation has declined significantly since its peak and now sits close to 2%, within the BoC’s target range. However, core inflation—which strips out more volatile items—remains sticky above 3%, signaling lingering price pressures.
- The Canadian economy has slowed. GDP growth is expected to be flat or negative for the second quarter, while consumer spending and housing activity have cooled.
- Trade uncertainty is weighing heavily on forecasts, particularly as new U.S. tariffs are set to take effect in August.
- Despite economic softness, the job market remains relatively stable, giving the Bank some leeway to keep rates higher for a bit longer.
🏠What This Means for Homebuyers and Sellers
📉 Variable-Rate Mortgages
Today's hold means no immediate change for variable-rate mortgage holders. Your current rate and payment will remain the same—for now.📊 Fixed-Rate Mortgages
Fixed rates are influenced by bond yields and market sentiment. While today’s decision won’t change fixed rates directly, expectations of future cuts may lead to gradual softening in fixed rates in the months ahead.🏡 Buyer Confidence
Buyers are still cautious. While lower rates earlier this year sparked some interest, today’s hold signals that rates might stay where they are through summer. Many buyers are likely to wait for clearer signals in the fall before jumping in.💼 Sellers’ Outlook
For sellers, the market remains competitive. Well-priced homes in desirable neighborhoods are still moving, but bidding wars and unconditional offers are less common than they were during the rate hike era. Pricing and presentation matter more than ever.🔮 What’s Next?
Most economists expect two more rate cuts before the end of 2025, possibly starting in the fall. Much will depend on inflation data, GDP figures, and how trade disputes evolve in the coming weeks.The Bank’s next scheduled announcement is on September 17, which will also include an updated Monetary Policy Report. This will give deeper insight into where things may be heading for the rest of the year.✅ Takeaways for Robert Tremblay’s Clients
- Buyers: If you're risk-averse, consider locking in a fixed rate—especially if a home meets your long-term needs. If you're more flexible, variable rates may offer better savings in the long run.
- Sellers: Focus on strategic pricing and staging. Interest rate stability may bring more buyers back into the market, but they’re choosier now.
- Renewals and Refinancing: Explore your options. Rates are still much lower than they were at the peak, and you may benefit from switching products or lenders.
🧠Final Thoughts
The Bank of Canada’s decision to hold interest rates steady reflects its cautious but measured approach to balancing inflation and economic health. While we’re not out of the woods yet, this environment could present key opportunities for both buyers and sellers—as long as you’re working with the right strategy.Have questions about how this affects your real estate goals? I’m always here to help you navigate your next move with clarity and confidence.—Robert Tremblay, REALTOR®
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