Skip to Content

Bank of Canada Holds Rate at 2.75% Amid Tariff Uncertainty

The Bank of Canada has once again held its key interest rate steady at 2.75%, marking the second consecutive decision to pause. This widely expected move comes as markets brace for uncertainty surrounding U.S. tariffs set to take effect in August.

Despite slower-than-expected economic growth, mixed job market data, and persistent core inflation above target, economists believe the central bank is choosing caution over drastic moves. As BMO economist Robert Kavcic explains, “Hawks and doves can both make reasonable cases right now,” signaling that policymakers want more clarity before adjusting rates further.

Governor Tiff Macklem reaffirmed that monetary policy cannot fully offset the impact of a prolonged trade conflict:

“What we can do is make sure Canadians don’t have to worry about big changes in their cost of living,” said Macklem.

Why This Matters to Borrowers and Real Estate Investors

While variable-rate mortgage holders may feel some relief with rates on hold, uncertainty remains. With trade tensions and inflationary pressures lingering, lenders continue to focus on prudent underwriting and low loan-to-value (LTV) lending to protect capital.

At Lendworth MIC, our approach aligns with these market conditions. We:

  • Maintain an average portfolio LTV of ~60%, ensuring strong equity buffers.
  • Focus on high-quality, marketable properties with strong exit strategies.
  • Offer flexible private lending solutions that adapt to changing economic conditions.

Investor Outlook: Stable Returns in a Volatile Market

For investors seeking steady income through private mortgage investments, today’s rate decision reinforces the value of non-bank lending opportunities. With traditional lenders tightening approvals, private lenders like Lendworth MIC are filling the gap, providing secured mortgage solutions while generating attractive, risk-managed returns for our shareholders.

Bank of Canada Poised to Hold Interest Rates Amid Sticky Core Inflation and Labour Market Resilience
All eyes are on the Bank of Canada this Wednesday as policymakers are widely expected to hold the policy rate at 2.75% for the third consecutive meeting. With core inflation remaining sticky around 3% and recent job growth surprising economists, the central bank is signaling stability in a period of ongoing uncertainty.