The Bank of Canada left the overnight rate unchanged at 2.25% on April 29, citing slow population growth, economic uncertainty, and ongoing affordability issues — and signalling no near-term cuts.

Last updated 2026-04-30. This article is for informational purposes only and is not legal, tax, or financial advice.

Bank of Canada holds at 2.25% — the easy-money tailwind for housing is officially paused

On April 29, 2026, the Bank of Canada announced it would maintain the policy interest rate at 2.25%, with the bank rate at 2.50% and the deposit rate at 2.20% (Bank of Canada press release, April 29, 2026). It was the second hold in a row after the December 2025 decision to pause, and it cements the consensus that rate-cut cycle is over for now.

Exactly what the Bank said

From the release: "Housing activity declined in the fourth quarter and is being held back by slow population growth, economic uncertainty and ongoing affordability issues." That sentence is doing a lot of work — it acknowledges that monetary policy alone can't fix Canada's housing problem, and it places the burden on demographics, fiscal policy, and supply-side reform.

Why this matters for Ontario mortgage costs

The overnight rate flows directly into prime rates at the major banks, which sets the floor for variable-rate mortgages and HELOCs. With the prime rate now anchored around 4.45% for an extended period:

Variable-rate mortgage payments will not see further automatic relief this cycle.
Fixed mortgage rates — driven by the Government of Canada bond market — have largely already priced in a long pause; further sharp declines look unlikely without a recession scare.
The mortgage stress test qualifying rate remains effectively binding for marginal buyers, since lenders qualify at the higher of (contract rate + 2%) or 5.25%.

What the consensus says about 2026 and beyond

Markets and economists now broadly expect the BoC to hold at 2.25% through much of 2026, with some forecasters pricing in a modest probability of increases in late 2026 or 2027 if inflation reaccelerates (BoC rate forecast consensus). The next scheduled rate decision is June 10, 2026.

What this means for the spring market

For buyers, the practical implication is simple: don't wait for cheaper mortgages this spring. The next mortgage you negotiate is almost certainly priced off rates similar to today's. For sellers, the absence of further monetary stimulus means demand is now driven by household formation, immigration, and affordability — not by falling rates. For investors, the math is harsher still: with the overnight rate at 2.25% and cap rates on GTA rentals in the 4–5% range, leveraged condo investing remains a tight cash-flow business at best.