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Monetary policy bumps up against stimulus limits

Rise in 10-year bond yields indicates tighter lending conditions
Bank of Canada's head office in Ottawa, Ontario. (CoStar)
Bank of Canada's head office in Ottawa, Ontario. (CoStar)
CoStar Analytics
August 31, 2026 | 2:43 AM

The Bank of Canada's policy interest rate has stood at 2.25% for 10 months since being set on Oct. 29, 2025. At this level, the policy rate is considered somewhat stimulative, as the neutral interest rate is estimated to be between 2.50 and 3%.

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