Every Market-Watcher We Spoke to Agrees This Is the BoC’s Next Move

Wahi asked real estate industry professionals — including economists, academics, and REALTORS® — about their predictions for the Bank of Canada’s next rate announcement.

By Josh Sherman | 3 minute read

Leading up to each scheduled BoC rate announcement, Wahi surveys upwards of a dozen real estate leaders to gauge market sentiment and find out where the industry thinks rates are headed.

Participants of an informal Wahi survey of real estate market-watchers unanimously predict that the Bank of Canada will maintain its overnight rate at 2.75% this week.

All 12 respondents to Wahi’s latest Rate Outlook Panel say the central bank will continue to stand on the sidelines at its next scheduled rate announcement on July 30, just as it did in June and April.

In the days leading up to each rate announcement, Wahi surveys upwards of a dozen real estate industry professionals, including economists at some of Canada’s biggest banks as well as academics and analysts. Respondents to Wahi’s Rate Outlook Panel are asked whether they anticipate a rate cut — and, if so, by how much — as well as the reasoning behind their decision.

The latest panel results are even more decisive than they were in June, when three-quarters of respondents correctly predicted a hold from the BoC. It is also the first time that a unanimous prediction has been reached since Wahi launched the Rate Outlook Panel this March.

Once again, Canada’s unpredictable trade relations with the U.S. came up repeatedly in panel responses.

“We’ve been witness to uncertainty and unpredictability — not solely in commercial real estate but in the overall economic landscape,” says Mark Fieder, Avison Young’s principal and president, Canada. “I expect the Bank will continue to pause and assess volatility, particularly when we saw a positive job report come in recently,” he continues.

A surprise — albeit modest — decline in Canada’s unemployment rate in June is among the indicators that Samson Solomon, mortgage content expert at nesto, finds supportive of the ongoing rate pause. “I think the Bank [of Canada], being highly data-driven, is likely to stay on the sidelines for now and wait to see whether inflation expectations or economic conditions shift more clearly in the months ahead,” says Solomon.

Wayne Kainu, head of mortgages at Neo Financial, agrees: “Inflation’s in check, the job market’s holding up, and with all the continuous U.S. tariff drama, they’ll probably let the dust settle (waiting for more data), before making their next move,” he notes.

So does Alex Leduc, founder and CEO of Perch Mortgages: “While GDP growth and the threat of a recession from the tariff war continue, inflation is trending upward and unemployment is stable, so the wait and see strategy from the Bank of Canada should continue.”

As Canadian unemployment inched lower — sinking to 6.9% in June from 7% in May — businesses remain optimistic looking ahead, notes Penelope Graham, mortgage expert and director of content at Ratehub.ca. “The latest Business [Outlook Survey] conducted by the Bank finds that while businesses are still deeply concerned about the impact of tariffs, their outlook on investment and hiring has improved,” says Graham. “The Bank of Canada has little rationale to cut right now as there are several signs that show the economy isn’t in need of immediate stimulus,” she explains, noting that by holding off now the BoC leaves room to cut later if needed.

Generally, the central bank trims rates to boost a sluggish economy. Doing so encourages spending and investment and typically results in higher inflation. However, as more than one panelist notes, inflation currently sits slightly below 3%, which is just within the 1-3% range the BoC targets (read Wahi’s overnight rate explainer to learn more).

“Overall, sticky inflation readings, a weakening but relatively resilient economic backdrop and prospects for larger fiscal spending are reasons why we do not expect the BoC will cut again in this cycle,” says RBC Assistant Chief Economist Robert Hogue.

“Trade tensions remain heightened and economic data is still soft. However, the Canadian labour market showed signs of bottoming out in June, and sentiment indicators, which took a nosedive in March, have also partially recovered.”

Since “the trade picture looks poor,” Moshe Lander, senior economics lecturer at Concordia University, says an argument could be made for a cut. However, he, like Hogue, suggests that all else considered, holding is the safest bet. “Given all the other macro data, it is best to hold the rate where it is until a clearer picture emerges.”

Another Rate Cut May Be on the Horizon  

While respondents very much doubt the BoC takes immediate action, some suggest it’s just a matter of time before monetary policymakers embark on another cut. “Between now and their next decision in September, the Bank will have a fuller picture of tariff repercussions, cost pressures, and other economic indicators. Come that time, I will be surprised if we don’t see a rate cut,” says Fieder of Avison Young.

“Weak GDP performance… and downside-risk-leaning uncertainty over the trade situation continue to give support to our view that the Bank will likely cut rates by about 50 points between now and early next year,” adds Peter Norman, vice president and economic strategist at Altus Group. 

That would be welcome news for many Canadian homebuyers. “From our perspective within the housing industry, mortgage rates have once again risen so a cut even minor would be ideal,” adds Pauline Lierman, vice president of market research at Zonda Urban. “Not what we expect, however.”