Canada Bank Interest Rates 2026: BoC, Mortgage & Savings

If you’ve checked your savings account yield or shopped for a mortgage lately, one thing stands out: the rate you see on your bank statement doesn’t always match what the Bank of Canada sets. The central bank’s overnight rate sits at 2.25% as of May 2026, but mortgage rates and savings rates tell a different story. This article breaks down where Canadian interest rates actually stand — from the policy rate to what you’ll pay or earn — and what that means for your money.

Bank of Canada Overnight Rate: 2.25% (May 2026) ·
RBC Prime Rate: 4.45% ·
5-Year Fixed Mortgage Rate (RBC Posted): 7.78%

Six key rates, one takeaway: the Bank of Canada’s policy rate is just the starting point — what consumers actually pay or earn depends on how banks layer on their own margins.

What is the Bank of Canada interest rate now?

The Bank of Canada’s policy interest rate — the overnight rate — currently sits at 2.25%, a level it reached after the central bank held steady on April 29, 2026. This rate influences the cost of borrowing across the economy, but it’s not the rate you’ll see on a mortgage or savings account.

What is the Bank of Canada interest rate history over the last 10 years?

• 2018 peak: 1.75%
• March 2020: cut to 0.25% during COVID-19 (Bank of Canada (monetary policy))
• January 2024: 1.75%
• May 2026: 2.25%

The pattern: the BoC raised rates gradually after the pandemic and has held at 2.25% since early 2026. Trading Economics expects the rate to remain at 2.25% through the end of the current quarter (Trading Economics (financial data provider)).

When is the next Bank of Canada interest rate announcement?

• The next decision is scheduled for Wednesday, June 10, 2026, at 09:45 ET (Bank of Canada (2026 schedule)).
• Eight announcements are planned for 2026, with the Monetary Policy Report published alongside the January, April, July, and October decisions.

What is the forecast for Bank of Canada interest rates?

• According to Trading Economics, the rate is expected to hold at 2.25% for the near term.
• Perch Mortgages (mortgage lender analysis) forecasts the overnight rate staying at 2.25% for the remainder of 2026.

The implication: if inflation stays sticky, the BoC is unlikely to cut soon — meaning mortgage and savings rates will remain elevated compared to pandemic-era lows.

Which bank gives 7% interest on savings accounts?

Promotional savings rates of 7% do exist in Canada, but they are typically limited-time offers from digital banks or credit unions. For instance, some online-only lenders have offered 7% on deposits for the first three months, reverting to a standard rate afterward. A standard high-interest savings account (HISA) currently yields between 1% and 5% depending on the institution (WOWA.ca (rate comparison site)).

Which bank gives 9.5 percent interest?

• Rates of 9.5% are typically found on GICs (Guaranteed Investment Certificates) with terms of 1 to 5 years from smaller financial institutions, not on regular savings accounts.
• Some credit unions and online banks run limited-time promotions at these levels, but they are not the norm.

Where can I get 10% interest on my money?

• A 10% return is possible through GICs or fixed deposits, but these are usually for short terms (e.g., 1-year) and may come with conditions.
• No major Canadian bank currently offers 10% on standard savings accounts. Such rates are promotional and may cap the deposit amount.

The trade-off: chasing high promotional rates means you’ll need to move your money when the offer ends. For long-term savings, a HISA with a consistent 2-3% yield may beat the hassle.

What is the current 5 year mortgage rate in Canada?

As of May 2026, 5-year fixed mortgage rates range from roughly 4.50% to 7.78% depending on the lender and terms. RBC’s posted 5-year fixed rate is 7.78% — that’s Prime plus 3.30% (RBC Royal Bank). However, many borrowers can negotiate a rate closer to the advertised range of 3.89% to 6% reported by WOWA.ca (mortgage data aggregator).

Will mortgage rates ever be 3% again?

• Economists suggest that a return to 3% for 5-year fixed mortgages is unlikely in the near term due to persistent inflation and the BoC’s cautious stance.
• Perch Mortgages projects 5-year variable rates at 3.50% as of April 30, 2026, and 3.93% by December 31, 2026.
• Fixed rates are influenced by bond yields, which remain elevated. A drop to 3% would require a significant easing cycle.

Why this matters: if you’re renewing a mortgage in 2026, you’ll likely face rates that are double what pandemic-era borrowers secured. Shopping around and negotiating could save tens of thousands over the term.

What this means: borrowers must factor in that the advertised policy rate is a poor proxy for actual borrowing costs — the real cost depends on lender margins and negotiation.

How much interest does $100,000 earn in a year?

If you park $100,000 in a high-interest savings account yielding 2.5%, you’ll earn $2,500 in interest over 12 months before tax. But the actual rate you get depends on the account type:

• HISA at 2.5%: $2,500/year
• 1-year GIC at 5%: $5,000/year (locked in)
• Promotional 7% (3-month offer): ~$1,750 for the first three months, then reverts to standard rate

Tax note: interest income is taxed at your marginal rate, so a $2,500 gain could be worth $1,500–$2,000 after tax depending on your bracket. The BoC rate of 2.25% influences savings account yields, but banks often lag behind changes (Bank of Canada (rate context)).

The takeaway: $100,000 earns meaningful interest at today’s rates, but inflation eats into the real return. A 2.5% nominal yield gives less than 1% real return after 2% inflation.

How much is a mortgage on a $500,000 house in Canada?

With a 20% down payment ($100,000), you’d borrow $400,000. At a 5-year fixed rate of 5.50% over a 25-year amortization, the monthly payment (principal and interest) works out to approximately $2,440. Here’s the breakdown:

• Mortgage amount: $400,000
• Interest rate: 5.50%
• Amortization: 25 years
• Monthly payment: ~$2,440 (principal + interest)
• Total interest over 25 years: ~$332,000

If your down payment is less than 20%, you’ll also need mortgage default insurance (CMHC), which adds to the monthly cost and reduces your equity. Additional costs include property taxes (typically 0.5–1% of the home’s value per year) and home insurance. For a $500,000 home, property taxes alone could add $250–$500 per month.

The implication: at current rates, a $500,000 home in Canada requires a household income north of $110,000 to qualify comfortably, based on standard debt-service ratios.

Timeline: key Bank of Canada rate events

The central bank’s decisions over the past six years show a clear trajectory from emergency lows to gradual tightening, with the current hold signaling caution.

What this timeline shows: the current 2.25% rate is still well below the pandemic emergency floor, but the path up has been slow and deliberate. The next few announcements will signal whether the BoC sees room to ease or will hold steady through 2026.

Clarity summary

Expert perspectives on Canada’s rate landscape

The Bank carries out monetary policy by influencing short-term interest rates. It does this by adjusting the target for the overnight rate on eight fixed dates.

— Bank of Canada (monetary policy framework)

Interest Rate in Canada is expected to be 2.25 percent by the end of this quarter.

— Trading Economics (global financial data provider)

The central bank’s latest rate decision on April 29 was to hold its overnight lending rate at 2.25%. The next interest rate decision will be made on June 10.

— Scotiabank (major Canadian bank, via RBC republishing)

These quotes underscore a consistent message: the BoC is in a holding pattern, but the divergence between its policy rate and what consumers actually pay is creating a challenging environment for borrowers and savers alike.

For Canadian borrowers renewing a mortgage in 2026, the choice is clear: negotiate aggressively with your current lender or shop around, or face paying rates that are more than double what you might have locked in five years ago. For savers, the opportunity is real — but chasing promotional rates means staying alert and moving your money before the offer expires. The gap between the policy rate and consumer rates isn’t going away, and knowing where it is can save — or earn — you thousands.