As of September 16, 2026, the Bank of Canada’s target for the overnight rate is 2.25%. The Bank maintained that rate at its September 2 decision. The Bank Rate is 2.50%, and the deposit rate is 2.20%.
The policy rate affects borrowing costs across Canada, but its effect is different for variable-rate and fixed-rate mortgages. It also influences lines of credit, savings rates and other lending products.
The Bank of Canada publishes the current rate and historical decisions on its policy interest rate page.
Bank of Canada Interest Rate in September 2026
| Rate | Current Level |
|---|---|
| Target for the overnight rate | 2.25% |
| Bank Rate | 2.50% |
| Deposit rate | 2.20% |
The target for the overnight rate has remained at 2.25% at every scheduled Bank of Canada decision so far in 2026.
2026 Bank of Canada Rate Decision Dates
The Bank of Canada announces its policy-rate decision on eight scheduled dates each year.
| 2026 Decision Date | Target Overnight Rate |
|---|---|
| January 28 | 2.25% |
| March 18 | 2.25% |
| April 29 | 2.25% |
| June 10 | 2.25% |
| July 15 | 2.25% |
| September 2 | 2.25% |
| October 28 | Scheduled |
| December 9 | Scheduled |
The October 28 announcement is scheduled to be released with a new Monetary Policy Report. The Bank lists the full schedule on its 2026 policy announcement schedule.
Why the Bank Held the Rate at 2.25% on September 2
In its September 2 statement, the Bank of Canada said recent Canadian growth and inflation data had evolved broadly in line with its July projection. It also noted increased upside risks to inflation from elevated energy prices and new tariff measures, while trade uncertainty continued to create risks for economic growth.
The Bank’s official September decision is available at Bank of Canada — September 2, 2026 policy-rate decision.
Canada’s Inflation Rate in Mid-2026
Statistics Canada reported that the Consumer Price Index rose 3.0% year over year in July 2026, compared with 2.8% in June. Gasoline and travel-tour prices contributed to the increase.
The Bank of Canada stated in September that inflation excluding gasoline was 2.2% in July and that measures of core inflation were close to 2%.
Canada’s monetary-policy framework targets inflation at 2%, the midpoint of a 1% to 3% control range.
See Statistics Canada’s July 2026 CPI release for the underlying inflation data.
How the Bank of Canada Policy Rate Affects Variable Mortgages
Variable-rate mortgage pricing is closely connected to lenders’ prime rates. Prime rates are set by individual financial institutions, but they usually move in response to changes in the Bank of Canada’s target overnight rate.
When the Bank changes its policy rate, borrowing costs can change on products such as:
- variable-rate mortgages
- home equity lines of credit
- unsecured lines of credit
- some variable-rate personal loans
The exact rate charged still depends on the lender, the product and the borrower’s agreement.
Fixed Mortgage Rates Do Not Move Directly With the Overnight Rate
Fixed mortgage rates are not set directly by the Bank of Canada’s overnight rate.
Fixed-rate mortgage pricing is influenced by factors that include Government of Canada bond yields, lender funding costs, credit risk, competition and lender margins.
Because bond markets can move independently of a Bank of Canada announcement, a five-year fixed mortgage rate can remain unchanged, fall or rise while the overnight rate stays at the same level.
Variable vs Fixed Mortgage: Main Rate Difference
| Mortgage Type | Main Rate Influence | Response to Bank of Canada Changes |
|---|---|---|
| Variable-rate mortgage | Lender prime rate and mortgage discount or premium | Usually responds relatively directly |
| Fixed-rate mortgage | Bond yields and lender funding conditions | Does not automatically move with each policy-rate decision |
What the 2.25% Policy Rate Means for the Mortgage Stress Test
The Bank of Canada’s 2.25% overnight rate is not the rate used to qualify a borrower under the federal mortgage stress test.
For uninsured mortgages at federally regulated lenders, the Office of the Superintendent of Financial Institutions currently requires qualification at the greater of:
- the mortgage contract rate plus 2 percentage points, or
- 5.25%.
OSFI explains the current minimum qualifying rate on its minimum qualifying rate page.
For down-payment requirements, amortization rules and the stress test, see our Canada Mortgage Rules 2026 guide.
How Policy Rates Affect Lines of Credit
Many lines of credit are priced using a lender’s prime rate plus or minus a specified margin.
If the prime rate changes after a Bank of Canada policy-rate move, the interest rate on a variable-rate line of credit can also change. The size and timing of the change depend on the lender and the loan agreement.
How Policy Rates Affect Savings Accounts and GICs
Bank of Canada policy can also influence deposit rates, including high-interest savings accounts and GICs.
Financial institutions set their own deposit rates, so a change in the overnight rate does not require every savings or GIC rate to move by the same amount.
Policy Rates and the Canadian Dollar
Interest-rate differences between Canada and other countries can influence demand for Canadian-dollar assets, but exchange rates are affected by many factors.
Important influences on the Canadian dollar include:
- Bank of Canada policy
- U.S. Federal Reserve policy
- oil and commodity prices
- economic growth
- trade developments
- global financial-market conditions
A single Bank of Canada decision therefore does not determine the Canadian dollar’s exchange rate by itself.
Bank of Canada Policy Rate vs Mortgage Rate
| Rate | Who Sets It? | Purpose |
|---|---|---|
| Target overnight rate | Bank of Canada | Key monetary-policy rate |
| Prime rate | Individual financial institution | Reference rate for many variable loans |
| Variable mortgage rate | Lender | Usually based on prime plus or minus a spread |
| Fixed mortgage rate | Lender | Influenced strongly by bond yields and funding costs |
| Mortgage stress-test rate | Federal regulatory framework | Qualifying rate rather than the actual mortgage payment rate |
Remaining 2026 Bank of Canada Decisions
After the September 2 decision, two scheduled policy announcements remain in 2026:
- October 28, 2026
- December 9, 2026
The Bank has not committed in advance to a specific rate change at either meeting. Each decision is announced after the Governing Council assesses current economic and inflation information.
2026 Key Numbers
| Item | Current Figure |
|---|---|
| Bank of Canada target overnight rate | 2.25% |
| Bank Rate | 2.50% |
| Deposit rate | 2.20% |
| July 2026 headline CPI | 3.0% year over year |
| July 2026 inflation excluding gasoline | 2.2% |
| Inflation target | 2% |
| Inflation-control range | 1% to 3% |
| Uninsured mortgage stress-test floor | 5.25% |
| Uninsured mortgage stress-test buffer | Contract rate + 2 percentage points |
Frequently Asked Questions
What is the Bank of Canada interest rate in September 2026?
The target for the overnight rate is 2.25%. The Bank maintained that rate on September 2, 2026.
When is the next Bank of Canada rate decision?
The next scheduled announcement is October 28, 2026. The final scheduled decision of 2026 is December 9.
Does a Bank of Canada rate change immediately change a variable mortgage?
Variable mortgages are usually tied to a lender’s prime rate, so they can respond relatively quickly when lenders change prime following a Bank of Canada decision. Exact timing depends on the mortgage contract and lender.
Does a Bank of Canada rate change automatically change a fixed mortgage rate?
No. Fixed mortgage rates are influenced more directly by bond yields and lender funding conditions than by the overnight rate itself.
Is the mortgage stress-test rate 2.25%?
No. For uninsured mortgages at federally regulated lenders, the current minimum qualifying rate is the greater of the contract rate plus 2 percentage points or 5.25%.
How many scheduled rate decisions does the Bank of Canada make each year?
The Bank schedules eight policy interest-rate announcements each year.
Disclaimer: This article provides general economic and mortgage information. Interest rates, mortgage pricing and qualification rules can change. Confirm current rates and lending requirements with the Bank of Canada, OSFI and the relevant financial institution.
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