The Bank of Canada held its key interest rate steady again on July 15, 2026. This is the sixth hold in a row. The rate stays at 2.25%, where it’s been since October 2025.
If you’re planning a mortgage renewal in Calgary in the next year, this announcement matters more than it might seem. Here’s what changed, what didn’t, and what to do next.
What the Bank of Canada Decided
The overnight rate stays at 2.25%. That means the typical prime rate — the number that sets your variable or adjustable mortgage rate — stays at 4.45%.
This was expected. Most economists predicted another hold. But the reasoning behind it tells us something useful about where rates might go next.
Why the Bank Is Holding Steady
Two forces are pulling in opposite directions right now, and that tug-of-war is exactly why the Bank isn’t moving.
Inflation is up — but mostly because of gas prices. The war in the Middle East pushed oil prices higher earlier this year. That fed straight through to gas pumps. Headline inflation hit 3.2% in May, the highest reading in a while.
But strip out gasoline, and inflation sits closer to 2.2%. Core inflation — a measure that filters out swings in volatile categories like fuel — is sitting right around the Bank’s 2% target. The Bank has said clearly that it isn’t seeing this energy spike spill over into the price of other goods and services in any meaningful way.
The economy is still finding its footing. Growth basically stalled in the first quarter of 2026. The Bank now expects the economy to grow just 0.7% for all of 2026 — down from its earlier forecast of 1.2%. The job market is still soft too. Unemployment sat at 6.5% in June, where it’s hovered for over a year and a half.
When inflation argues for raising rates and a soft economy argues for cutting them, holding steady is the safe middle path.
A Notable Shift in Tone
Here’s the part worth paying attention to: the Bank dropped some of the warning language it had used at the last two meetings.
Previously, the Bank had floated the idea that it might need to raise rates several times in a row if the war kept driving up energy costs. It also warned it might need to cut if the U.S. brought in major new trade restrictions. Both of those warnings are gone from this month’s statement.
That’s a meaningful shift. It suggests the Bank feels more settled — not that it’s about to move in either direction, but that the extreme scenarios it was bracing for now look less likely. The Bank’s own language put it simply: the current rate “remains appropriate to sustain the economic recovery and bring inflation back to the 2% target.”
What This Means for Your Mortgage
If you have a variable or adjustable-rate mortgage: nothing changes today. Your rate and payment stay the same.
If you have a fixed-rate mortgage: today’s announcement doesn’t touch you directly. Fixed rates move with government bond yields, not the Bank’s overnight rate. Bond yields have been volatile lately, partly because of the same Middle East conflict driving up oil prices. That’s worth watching if you’re renewing soon, since it means fixed-rate pricing could shift with little notice.
If you’re renewing your mortgage renewal in Calgary within the next 12 months: you’re likely coming from a rate set years ago, before rates rose from their pandemic-era lows. It’s worth reviewing what a renewal at today’s rates would actually mean for your payment — well before your renewal date shows up in the mail.
What’s Worth Watching Between Now and September
Two things could shift this outlook before the Bank’s next meeting:
- Oil prices and the Middle East conflict. The Bank has said this is the biggest risk to its inflation forecast. If tensions escalate further and oil prices climb, that could change the calculus.
- Canada’s trade relationship with the U.S. The Canada-U.S.-Mexico trade agreement moved to annual reviews as of July 1. That adds an ongoing layer of uncertainty for Canadian exporters and, in turn, the broader economy.
The Bottom Line
The Bank of Canada is holding at 2.25% because the case for raising rates and the case for cutting them are roughly balanced right now. That’s a stable — if uncertain — environment for anyone with a mortgage.
The next Bank of Canada announcement is scheduled for September 2, 2026. In the meantime, if your mortgage renewal in Calgary is coming up, or you just want to understand where your rate stands, we’re happy to walk through your options.
Click here to see the Bank of Canada rate announcement schedule.
Fixed vs. Variable Mortgages — Which Is Right for You?
What to Do 6 Months Before Your Mortgage Renewal
