5 Things to Know Today: BoC Hike Odds, Fixed Rates, Tariff Swap, $100 Oil & Budget Countdown (Oct. 25)

 

Canadian Money Brief • Sunday, October 25, 2026

A big week for your wallet starts Wednesday. Here are the five things Canadians should know before it begins.

1	The Bank of Canada decides Wednesday, and markets lean toward a hike

The Bank of Canada announces its rate decision at 9:45 a.m. ET on Wednesday, Oct. 28, alongside a new Monetary Policy Report. Prediction markets price roughly a 79% chance of a quarter-point hike to 2.50%, up sharply after Governor Tiff Macklem’s hawkish comments at the IMF meetings, though analysts remain split and some expect a “hawkish hold.” The U.S. Fed also decides that day.

What it means for you: Variable-rate mortgage and HELOC holders feel it first. A 0.25-point hike works out to roughly $70 more per month on a $500,000 variable mortgage (25-year amortization), and prime would move from 4.45% to 4.70%. A hold means little change until the next decision on Dec. 9.

2	Fixed mortgage rates have already moved without the Bank

Fixed rates follow bond yields, not the overnight rate, and the five-year Government of Canada yield is sitting around 3.6%. The lowest three- and five-year fixed rates are about 4.34%, against roughly 3.43% for the lowest variable, and BMO has lifted its posted five-year fixed to 5.14%. The Bank of Canada estimates about one in three mortgage holders will see higher payments by the end of 2026.

What it means for you: If your renewal is coming within the next few months, ask your lender about a rate hold (many run up to about 120 days) and compare variable and fixed offers side by side before Wednesday’s decision, not after.

3	The U.S. swaps its 50% tariff list on Canadian goods on Friday

President Trump signed a proclamation on Oct. 23 changing which Canadian products face the 50% Section 338 duties, effective Friday, Oct. 30. Plywood sheets, some paper products, certain machinery and refrigeration equipment, and certain packing crates come off the list. Certain valves, carpets, waste products and other goods go on. U.S. officials say the overall impact stays the same, so this is a reshuffle, not a deal. U.S. midterm elections follow on Nov. 3.

What it means for you: Workers and suppliers in plywood, paper and packaging may get relief, while carpet and valve makers face new 50% duties. The trade dispute is unresolved, which keeps pressure on Canadian export jobs and on the Bank of Canada’s balancing act.

4	Oil tops US$100 and stocks slide on AI-spending worries

Oil pushed above US$100 a barrel on Friday as stocks fell. The S&P/TSX composite closed down 185.27 points at 35,788.18, while the Dow dropped 652.82 points to 52,215.16 on worries that companies are overspending on AI. Macklem has said inflation, now around 3%, would likely drift higher if oil stays near US$100.

What it means for you: Sustained $100 oil is a big reason rate-hike talk is alive, and it keeps fuel and heating costs elevated. The federal fuel excise tax holiday runs to Jan. 31. For TFSA and RRSP investors, one rough Friday is not a reason to rebalance, but it is a good week to check how concentrated your portfolio is in tech and energy.

5	Budget 2026 is 11 days away, with the numbers already tightening

Finance Minister François-Philippe Champagne will table the federal budget on Thursday, Nov. 5. The Parliamentary Budget Officer now expects a $63.3-billion deficit for 2026-27, down from $71.8 billion in its June outlook, and sees the operating budget balancing in 2028-29, a year later than the government promised. Statistics Canada also releases August GDP on Friday, Oct. 30.

What it means for you: Budget week often brings changes to savings accounts, benefits and taxes. Rather than making big RRSP or TFSA moves on speculation, wait for the actual measures and their effective dates.

Key dates this week

Wed, Oct. 28	Bank of Canada decision and Monetary Policy Report, 9:45 a.m. ET; U.S. Fed decision
Fri, Oct. 30	U.S. tariff list changes take effect; Statistics Canada August GDP
Tue, Nov. 3	U.S. midterm elections
Thu, Nov. 5	Federal Budget 2026

Sources: Bank of Canada schedule; Canadian Press via BNN Bloomberg (Oct. 23 market close); White House fact sheet on Section 338 changes (Oct. 23); MoneySense; Money.ca; Canadian Press/Advisor.ca on Budget 2026 and PBO figures. Market odds and mortgage rates change quickly. This is general information, not financial advice.

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