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CAD Overnight Rate, Jan 28, 2026

Canada's Overnight Rate Holds Steady: What This Means for Your Wallet

Meta Description: Canada's Overnight Rate remained unchanged at 2.25% on January 28, 2026. Discover what this key economic data release means for your mortgage, savings, and the Canadian dollar.

The Bank of Canada (BOC) has spoken, and for now, the cost of borrowing money across the country is holding pat. On January 28, 2026, the BOC announced its latest decision on the CAD Overnight Rate, keeping it steady at 2.25%. This might sound like a technical detail for bankers, but this seemingly small number has a ripple effect that touches every Canadian's financial life, from the mortgage you pay to the interest you earn on your savings.

For those who track these announcements closely, the outcome was exactly as predicted. The CAD Overnight Rate actual matched the CAD Overnight Rate forecast at 2.25%, and it also mirrored the previous CAD Overnight Rate of 2.25%. While this lack of movement might seem uneventful on the surface, it signals a period of cautious stability in Canada's economy.

What Exactly is the CAD Overnight Rate?

Let's break down what the Overnight Rate actually is. Think of it as the benchmark interest rate that the country's major financial institutions use when they lend money to each other overnight. It's the very foundation upon which other interest rates are built. The Bank of Canada, through its Governing Council, decides where to set this rate.

This rate influences everything from the prime lending rate that banks offer to businesses and consumers, to the rates on your savings accounts and, crucially, your mortgage. When the BOC changes the Overnight Rate, banks often follow suit with their own lending and borrowing rates.

Holding Steady: What the 2.25% Means for You

In this latest CAD Overnight Rate report Jan 28, 2026, the BOC chose not to alter the existing rate. This decision, holding the CAD Overnight Rate at 2.25%, has several implications:

  • Mortgages: For homeowners with variable-rate mortgages or those looking to renew, this means your payments are likely to remain the same for now. The interest you pay on your mortgage is closely tied to the Overnight Rate, so stability here is generally good news for household budgets. Fixed-rate mortgages are less directly impacted by short-term rate changes, but longer-term trends are still influenced.
  • Savings Accounts: If you have money tucked away in a savings account or a Guaranteed Investment Certificate (GIC), you won't see a sudden jump in your interest earnings. While 2.25% is a modest return, it's important to remember that higher rates generally come with higher borrowing costs elsewhere.
  • Borrowing for Businesses: Small and large businesses that rely on loans to operate or expand will also find borrowing costs unchanged. This can provide a predictable environment for business planning and investment.

The fact that the CAD Overnight Rate has remained at 2.25% for some time, and the latest data showed no change, suggests the Bank of Canada is comfortable with the current economic pace. They are likely observing various economic signals to determine if further adjustments are needed in the future.

Why Traders and Investors Keep a Close Eye on This Data

While you might not be directly trading currency, the CAD Overnight Rate is a paramount factor in the valuation of the Canadian dollar (CAD). Traders and investors look at indicators like this to predict future interest rate movements, which significantly influence investment decisions and currency strength.

  • Currency Impact: Generally, when a country's central bank raises interest rates, it makes that country's currency more attractive to foreign investors seeking higher returns. Conversely, lower rates can make a currency less appealing. Since the CAD Overnight Rate remained at 2.25%, there wasn't a strong immediate catalyst for a significant shift in the Canadian dollar's value based on this specific announcement.
  • The Bigger Picture: The BOC Rate Statement: It's crucial to understand that the actual rate decision is often "priced into the market" by the time it's released. What truly moves markets is the accompanying statement from the Bank of Canada. This statement provides the BOC's outlook on the economy, inflation, and their forward guidance on potential future rate changes. Traders meticulously analyze these "forward notes" to anticipate the BOC's next moves.

Looking Ahead: What's Next for the CAD Overnight Rate?

The Bank of Canada sets its interest rate eight times a year. The next scheduled announcement for the CAD Overnight Rate is on March 18, 2026. Until then, the 2.25% rate will continue to guide borrowing and lending costs across Canada.

While this latest CAD Overnight Rate data offered no surprises, it’s a reminder of the powerful forces shaping our economy. Staying informed about these key indicators can help you make more informed financial decisions for your household. The stability provided by the current rate allows for a predictable financial landscape, but Canadians will be keenly awaiting the BOC's next statement for clues about what the future holds.

Key Takeaways:

  • No Change: The Bank of Canada's Overnight Rate remained unchanged at 2.25% on January 28, 2026.
  • Predictable Impact: This means borrowing costs (like mortgages) and savings rates are likely to stay the same for the immediate future.
  • Trader Focus: While the rate itself was expected, investors will closely watch the BOC's accompanying statement for hints on future rate movements.
  • Next Decision: The next BOC interest rate announcement is scheduled for March 18, 2026.