Bank of Canada Holds — And the Forecasts Tell an Interesting Story

The Bank of Canada’s decision to hold rates this week brought a sense of short-term stability to the housing market — but the real story is how closely (and not so closely) the major banks saw this coming.

If you look at the forecast chart, most lenders — RBC, TD, CIBC, and NBC — expected the overnight rate to remain around 2.25% well into 2026. That camp was essentially right: the Bank held steady, reinforcing the idea that policymakers are in “wait-and-see” mode.

BMO, however, stood out. Their forecast anticipated earlier rate relief, projecting cuts toward 2.00% through 2026. That view now looks early — not impossible, but clearly ahead of where the Bank of Canada is willing to move given today’s uncertainty.

On the other side of the spectrum, Scotiabank forecasted rates moving higher later in 2026. While that hasn’t played out yet, Governor Tiff Macklem’s comments suggest that door isn’t closed either. He emphasized elevated uncertainty, geopolitical risk, and trade disruptions — all factors that make the direction of the next move far from clear.

From a housing perspective, Rates.ca summed it up well:
The market is still very much in buyers’ favour. Price pressure remains downward, affordability is strained, and sellers need to be realistic. At the same time, renewal activity is climbing as homeowners look for ways to manage payments — whether through better rates or longer amortizations.

Bottom line:
The rate hold doesn’t signal a rebound — it signals pause. The banks that predicted stability were closest to the mark, but the next move could still go either way. For buyers and sellers alike, strategy matters more than headlines right now.

Happening in Hamilton

Week of January 30th - February 5th

HAMILTON WINTERFEST 2026 (Various Locations Across Hamilton) — Jan 31st–Feb 16th — Hamilton’s city-wide winter celebration returns with community events, arts programming, outdoor fun, live performances, and family-friendly activities happening across neighbourhoods throughout the city. Select events free Click here for more info

TORONTO ROCK vs OTTAWA BLACK BEARS (TD Coliseum) — Sat Feb 1st, 7pm — Catch fast-paced National Lacrosse League action as the Toronto Rock take on the Ottawa Black Bears in a high-energy matchup that’s fun for sports fans and families alike. Tickets from $56 Click here for more info

FORGE FC vs TIGRES UANL (Tim Hortons Field) — Tue Feb 3rd, 8pm — Forge FC hosts Mexican powerhouse Tigres UANL in an exciting Concacaf Champions Cup showdown. Tickets from $41 Click here for more info

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