Bank of Canada Holds Rate at 2.25% as Borrowers Face a Heavy Renewal Wave

The Bank of Canada left its benchmark policy rate unchanged at 2.25% at its mid-July decision, keeping borrowing costs steady as global trade tensions and the conflict in the Middle East added to economic uncertainty. The hold, widely expected by economists, reflects a central bank weighing sticky inflation risks against a softening labour market. Canada's economy added roughly 18,000 jobs in June and the unemployment rate slipped to about 6.5%, a moderate gain led by part-time and service-sector work that was unlikely to shift the bank's stance. For households, the decision leaves many borrowers navigating still-elevated fixed mortgage rates just as a large share of Canadian mortgages come up for renewal in 2026, a wave that could strain budgets for those who locked in at ultra-low rates years ago. The central bank has signalled it will remain data-dependent and cautious, noting that sustained price pressures could warrant a policy response while downside risks to growth persist. Policymakers and regulators continue to watch household debt, mortgage-renewal risk and the resilience of the financial system closely as conditions evolve through the second half of the year.