Najib Damerji -Mortgage Broker

Ahead of the central bank's recent decision, economists were split: 19 of 34 in a poll expected a quarter-point increase to ~2.5%.
Support for a hike grew after the governor signaled high oil prices could lift inflation forecasts and make price pressures broader, more persistent.
Canada's annual inflation reached ~3% in Late-Q3, while preferred core measures stayed below <2%, and business and consumer inflation expectations moved higher.
Economists favoring patience pointed to softer employment, weak housing, limited spillover from energy costs into core inflation, and uncertainty around Canada-US trade.
Some forecasters also said higher bond yields were already lifting mortgage rates, while one outlook saw another hike in Late-Q4 toward ~2.75%.

Canada's Economists Split on a Rate Hike

For months, many economists downplayed a Canada rate hike, citing contained inflation, softer labour, tariff uncertainty and energy shocks, yet the central bank still hiked.
Bond, swap and forward markets flagged higher borrowing costs for months, with the forward curve implying ~75-125 bps of tightening over the next 12-24 mo.
The guidance: distrust forecasts that contradict market pricing, and watch the 2-yr government bond yield for signs borrowing costs may be headed higher.
Some forecasters did see hikes coming, including one bank team that expected the next move higher on November 12, 2025, nearly a year early.
The core lesson is risk management: before a new hiking cycle, compare fixed and variable options, and after multiple hikes, shorter terms may fit.