Bank of Canada Keeps Interest Rate Steady at 2.75%
What This Means for Buyers, Sellers, and Ottawa’s Housing Market
On July 30, 2025, the Bank of Canada announced it will maintain its policy interest rate at 2.75%, marking a continued pause in rate changes amidst economic uncertainty. This decision reflects both cautious optimism and a wait-and-see approach as trade tensions with the U.S. and inflation pressures shape the financial landscape.
So, what does this mean for Ottawa homeowners, buyers, and sellers? Let’s break it down.
The Current Economic Climate in Canada
Canada Shows Signs of Resilience Despite Global Pressure
Despite global trade disruptions (mainly due to shifting U.S. tariff policies) the Canadian economy has shown some resilience. After strong growth in early 2025, Canada’s GDP dipped in the second quarter due to a sharp pullback in exports. The national unemployment rate rose to 6.9% in June, and wage growth has eased.
In Ottawa, job markets in some sectors remain steady, and consumer spending, though cautious, continues. This stability has helped keep local housing demand alive, particularly in desirable neighbourhoods.
Why Did the Bank of Canada Hold the Rate?
The Bank of Canada cited ongoing uncertainty around U.S. trade policies, inflationary trends, and soft domestic data as key reasons for not changing the interest rate. While inflation ticked up to 1.9% in June (2.5% excluding taxes), it’s still within the Bank’s comfort zone.
Officials are watching whether a weakening economy will cool inflation or whether global pressures will push prices up again. Until then, they’re taking a careful, data-driven approach.
What Does It Mean for Homebuyers?
This hold is encouraging news for buyers in Ottawa who may have been waiting on the sidelines. A stable interest rate can mean more predictable mortgage rates in the short term. With inflation appearing to level off and home prices becoming more accessible in certain segments, many first-time buyers might find this a good time to enter the market.
Good to know: If economic conditions continue to soften, rate cuts could be on the horizon, potentially making borrowing even more affordable later this year.
What Does It Mean for Sellers?
For sellers, today’s rate hold helps preserve buyer confidence. Stability in interest rates can support steady demand, especially in Ottawa where housing remains more affordable than other major cities.
While the pace of bidding wars has cooled compared to 2021–2022, homes in well-located or move-in-ready condition are still drawing strong interest. If you’re thinking of selling, now is a great time to connect with a real estate expert to understand how your property fits into today’s market.
Impact on Ottawa's Real Estate Market
Ottawa’s housing market continues to benefit from steady population growth, government employment, and overall affordability compared to cities like Toronto or Vancouver. While national uncertainty may slow down activity in some regions, Ottawa remains a relatively stable and sought-after market.
Buyers and sellers are adapting to a more balanced market, with slower price increases but stronger long-term fundamentals. This pause in interest rates helps maintain momentum while giving everyone breathing room.
What Can We Expect Going Forward?
The future remains uncertain. If the economy continues to slow and inflation stays low, we may see rate cuts later in 2025 or early 2026. On the other hand, if global trade tensions ease and consumer spending rebounds, the Bank may choose to wait even longer.
For now, economists are divided. Some suggest the Bank of Canada is already behind on cutting, while others believe inflation still poses enough of a threat to hold steady.
Let’s Talk About Your Next Move
Whether you’re thinking of buying, selling, or just want to understand how these economic updates affect your real estate plans, we’re here to help.
Stay informed, stay flexible, and work with a team who understands how these shifts impact your goals.
Contact us today for a personalized consultation and let’s make the most of this market together.
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