The Bank of Canada announced on September 17th that they will cut their policy interest rate, which brings it to 2.50%.

Key Takeaways

  • The Bank of Canada has cut their policy interest rate, which brings it to 2.50% as of their latest interest rate announcement.
  • The next interest rate announcement is on Wednesday, October 29, 2025.
  • Talk to an experienced mortgage advisor to understand the announcement’s impact on your mortgage payment or upcoming renewal

Why did the Bank of Canada cut interest rates? 

Commentary from Perch’s CEO and Principal Mortgage Broker, Alex Leduc:

The latest Bank of Canada interest rate announcement occurred on September 17, 2025. The negative economic outlook for the Canadian economy continues to weigh heavily on the Bank of Canada, and they are cutting rates to combat slow GDP growth and rising unemployment.

What does this mean for my mortgage with Perch? 

  • For variable rate mortgages (meaning your payments don’t fluctuate as prime rates change): Today’s decrease means that less of your existing mortgage payments go towards the interest portion of your mortgage as your amortization decreases, but your payments will stay the same. Use our Mortgage Renewal Calculator to get an estimation of what your expected rate and payment will be at your maturity date. If the payment isn’t manageable, connect with your advisor well in advance to look at all options.
  • For adjustable rate mortgages (meaning your payments fluctuate as prime rates change): The latest cut will further decrease your mortgage payments and the outlook shows that rates are expected to remain at this level for the next few years.

In the chart below, you can see how our 5-year variable rate forecast has changed over time based on the Bank of Canada’s interest rate announcements. (Like what you see? Sign up to get free, personalized mortgage insights and our monthly mortgage outlook!)

The rate outlook is largely unchanged since last month, with the market pricing in a slightly higher probability of a 0.25% rate cut in late 2025. The current level of rates is expected to be largely flat over the next 5 years 

Will mortgage rates go up in the next 5 years?

Based on our latest Mortgage Rate Outlook, expect 5-year variable mortgage rates to continue dropping in 2025. We’ll be updating our mortgage rate forecast after every Bank of Canada interest rate announcement – you can subscribe to our mortgage rate forecast for free.

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What is the Bank of Canada interest rate today?

The current Bank of Canada interest rate is 2.50%, with a 0.25% rate cut announced on September 17, 2025.

When is the next Bank of Canada interest rate announcement?

The next scheduled Bank of Canada interest rate announcement is Wednesday, October 29, 2025 at 9:45 AM ET.

What are the interest rate announcement dates in 2025?

There are a total of 8 Bank of Canada interest rate announcements each year. The dates for 2025 are as follows:

  • Wednesday, January 29, 2025
  • Wednesday, March 12, 2025
  • Wednesday, April 16, 2025
  • Wednesday, June 4, 2025
  • Wednesday, July 30, 2025
  • Wednesday, September 17, 2025
  • Wednesday, October 29, 2025
  • Wednesday, December 10, 2025

(Source: Bank of Canada)

The Bank of Canada typically makes their interest announcement at 9:45 AM Eastern Time.

Here’s what else we’re reading:

September Mortgage Outlook  (4 min read time)

Fixed or Variable? How to choose the right mortgage for you (4 min read time)

Mortgage switch vs mortgage renewal (4 min read time)

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