BOC / CENTRAL BANK
Bank of Canada
Official policy, market expectations and what they mean for CAD.
CAD currency outlookPolicy snapshot
Last policy decision
28 Oct 2026Our policy assessment
- Policy focus
- Was the recent rate rise enough to stop higher energy costs spreading into other prices?
- Key risk
- Businesses may pass higher costs on to customers, while trade uncertainty makes growth harder to predict.
- What to watch
- October CPI should show whether energy-driven inflation has started to reach the BoC's preferred underlying measures.
The policy debate
Our forward-looking assessment has not yet been published. The official facts and policy tests below remain available.
Evidence and upcoming tests
What changed
Separate evidence available at the last decision from releases since then- Policy decision · · Available at last decision
The BoC raised its main interest rate by 0.25 percentage points after inflation was higher than it had forecast.
Policy implication: The rate increase is an official policy action. Later core inflation and demand data are needed to judge its effectiveness.
Evidence that matters
Selected readings beyond the two headline indicators above, with their limits explained.
| Indicator | Latest | Previous | Policy implication |
|---|---|---|---|
| CPI-medianBoC preferred core measure · year on yearOfficial source | 1.9%Sep 2026 | 2.0%Aug 2026 | The median measure also points to contained broad inflation. The pair of core measures is useful, but neither fully captures a new energy shock yet. |
| Real GDP growthCanada real GDP · expenditure q/qOfficial source | 0.8%Q2 2026 | 0.1%Q1 2026 | Faster headline GDP shows some capacity to absorb tighter policy. Trade and inventory swings can obscure underlying household and business demand. |
How to read these figures
CPI, HICP and PCE measure consumer-price changes, using different national methods. “Core” or “underlying” measures seek the broader price pattern. GDP measures economic output. “Seasonally adjusted” removes usual seasonal movements. One release rarely establishes a trend; compare the reference periods as well as the values.
Upcoming tests
Consequential official events. Times are shown in UTC only when verified.
- Economic releaseCPI inflation (Oct)
Are core measures and service prices rising along with energy, or does the shock remain narrow?
Related research
BoC hikes to 2.50% — CAD takes it in stride
The Bank of Canada has ended its long pause, raising its policy rate by a quarter percentage point to 2.50%. The hike was expected. CAD’s muted initial response is a useful reminder: delivering the expected decision does not give the market much new to buy.
Image credits
Building: investingLive
Tiff Macklem: investingLive
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