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BoC Opens the Door to Rate Hikes: What It Means for Your Mortgage

  Published September 4, 2026 The Bank of Canada held its policy rate at 2.25% on September 2 — the seventh straight hold — but Governor Tiff Macklem didn't sound like a central banker done for the year. He told reporters the Bank is "prepared to raise interest rates, and if it takes more than one increase, we're prepared to do that," if inflation stays too high. That's a real shift in tone, and it lands right as a wave of Canadians hit their mortgage renewal date. Here's what changed, who's forecasting what, and what it actually means for your payment. Why the Bank Suddenly Sounds Hawkish Canada's annual inflation rate has climbed to around 3% — a full point above the Bank's 2% target — and the Bank is pointing squarely at energy prices. Oil has stayed elevated because of the Iran conflict and disruption near the Strait of Hormuz, pushing gas prices up and dragging headline CPI with it. Core inflation, which strips out food and energy, is still s...
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Canada’s Labour Market Contracts as Job Losses Hide a Falling Unemployment Rate

Workers inspect sheets of stainless steel after being pressed from coils, at Magna Stainless and Aluminum in Montreal

Canada’s economy lost 25,000 jobs in January, yet the unemployment rate unexpectedly dipped to 6.5%, a shift driven largely by fewer people actively seeking work rather than by employment growth.

The decline in unemployment was tied to a shrinking labour force, as participation fell and fewer Canadians remained engaged in job searches. Economists note that this can make the labour market appear healthier than it truly is, masking underlying weakness.

Job losses were spread across multiple sectors, with part‑time employment seeing notable declines even as full‑time positions rose modestly. Analysts warn that the combination of job losses and reduced labour force participation points to softening economic momentum, especially as high interest rates continue to weigh on hiring and consumer activity.

January’s data highlights the complexity of Canada’s economic landscape: fewer jobs, fewer job seekers, and a headline unemployment rate that doesn’t tell the full story.


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