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Canadian dollar rises after Bank of Canada holds its rate at 2.25%

USD/CAD dropped about 0.15% to roughly 1.3875 after the Bank of Canada kept its overnight rate unchanged, citing uncertainty from Middle East conflict and US tariff risks.

Reported · Written up by our desk · Central Banks

HousingWire reports the Canadian dollar strengthened versus the US dollar after the Bank of Canada left its monetary policy rate unchanged.

Following the decision, USD/CAD fell to around 1.3875, down roughly 0.15% on the day.

The Bank of Canada kept its overnight rate at 2.25%, saying the economic outlook remains particularly uncertain.

In its policy statement, it pointed to fluid risks from the conflict in the Middle East and the situation around US tariffs, while noting subdued labor demand and signs of excess supply that limit the need for tighter policy, even as upside inflation risks have increased.

Investors now look to Bank of Canada Governor Tiff Macklem’s press conference for clues on whether the central bank views the current rate as sufficiently accommodative or sees justification for a future adjustment.

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