The Bank of Canada’s October 28th, 2026 rate decision is the last to come with a full Monetary Policy Report before the year ends. With two major banks forecasting a 50 basis point hike by December and markets pricing in a partial increase, October 28th is the decision that shows Canadian borrowers what 2027 actually looks like.
If You Read Nothing Else, Here Are The Key Takeaways
• The Bank of Canada’s October 28th 2026 rate decision comes with the year’s final Monetary Policy Report: the Bank’s last full economic update before 2027 begins.
• National Bank and Scotiabank are forecasting a 50 basis point rate hike by December 2026; on the other hand, BMO and TD expect no change through the end of the year.
• Markets are pricing in a partial rate increase on the December 9th decision — the gap between market pricing and economist forecasts is unusually wide.
• The September 2026 CPI released on October 19th, nine days before the October 28th decision, is the final major inflation data point the Bank’s governing council will have before it decides.
• A rate held on October 28th with neutral language signals that December stays flat. A hold with hawkish language in the announcement or an outright hike, changes the 2027 rate outlook entirely.
Statistic Highlight:
50 — is the number of basis points National Bank and Scotiabank are forecasting the Bank of Canada will hike by December 2026.
Why the Bank of Canada October 28th, 2026 Rate Decision Matters More Than the Others
The upcoming Bank of Canada’s (BoC) October 28th rate decision carries a great weight with it. The BoC has eight scheduled rate decisions each year. Four of these come with a Monetary Policy Report (MPR): in the months of January, April, July, and October. MPR decisions carry more weight than standard announcements, because the Bank publishes updated economic forecasts alongside the rate decision itself. October 28th is the last MPR of the 2026 year. After that, there is only December 9th, which is a standard announcement with no updated forecasts, which won’t affect markets as much as the BoC October announcement.
What happens on October 28th effectively showcases next year’s rate environment for Canadian mortgage borrowers. If the October MPR signals that inflation is on track to return to 2% without rate increases, the probability of a December hike falls significantly. The MPR could show persistent inflation, currently driven by elevated energy prices and tariff economic pass-through. Then the December hike probability rises, and 2027 begins with upward rate pressure already in place.
The December Hike Debate
Two of Canada’s major banks are forecasting a hike from the BoC’s October 28th, 2026 rate decision before the end of the year. National Bank and Scotiabank have published forecasts calling for a 50 basis point increase on the December 9th decision, taking the overnight rate from 2.25% to 2.75%. BMO and TD are forecasting no change in the rates through to the end of the year.
Markets sit between those two positions. They are pricing in a partial increase — roughly a 40% to 50% probability of a 25 basis point hike on December 9th as of late September 2026. That partial pricing creates the unusual gap between market expectations and economist forecasts that True North Mortgage’s Dan Eisner flagged in his September 15th rate commentary.
The September inflation data, released October 19th, is the highlight. The Canadian Consumer Price Index (CPI) reached 3% in July 2026, driven by a 25.7% jump in gasoline prices from the Strait of Hormuz conflict. If the September CPI comes in above 3% or signals core inflation rising, then it is quite possible the October 28th MPR will reflect the upside risk to inflation and the December hike probability rises. If the September CPI eases toward 2.5%, then the outlook changes.
What October 28th Could Tell You?
There are three possible outcomes from the BoC’s October announcement. Here’s what each means for borrowers.
Hold with neutral language:
The BoC’s MPR shows national inflation on track to return to 2% without rate increases. December 9th is probably another hold. This means that variable-rate mortgage borrowers can breathe. However, fixed-rate borrowers who locked in before October 28th may have paid a premium for protection they did not need for 2026.
Hold with hawkish language:
The MPR acknowledges and points out persistent inflation risk, and the BoC’s governing council signals readiness to act. The probability of a December 9th hike rises, and bond yields move higher immediately. Fixed-rate borrowers respond within days, and the variable-rate borrowers face a live risk of a December payment increase.
Rate hike on October 28th:
The governing council decides not to wait for December. The overnight rate moves to 2.5%, the prime rate follows, and variable-rate mortgages adjust immediately. This is the least likely scenario, given that all major bank economists are forecasting a hold on October 28th — but it is not a zero percent chance given the warning language of the September 16th announcement.
When to Talk to a Mortgage Broker
With the October 28th decision approaching and active debate over a possible December hike, a broker can model your mortgage balance against the three scenarios mentioned above. They can show you the real difference between a hold, a 25 basis point hike, and a 50 basis point hike, before the October 28th decision arrives. You can typically secure rate holds on new mortgage purchases and renewals for 90 to 120 days at no cost, locking in a ceiling while the BoC’s October 28th data comes in.
Frequently Asked Questions
1. What is the Bank of Canada October 28th, 2026 rate decision and why does it matter?
The Bank of Canada October 28th, 2026 rate decision is the fourth of eight scheduled rate decisions for this year and the last to come with a Monetary Policy Report. This is the Bank’s quarterly publication of updated economic forecasts for GDP growth, inflation, and the interest rate path. Because it is the final MPR before 2027, October 28th will give the clearest signal yet of whether the Bank plans to raise rates before the year ends and what next year’s rate environment will look like.
2. Will the Bank of Canada raise rates on the October 28th, 2026 decision?
Most major bank economists are forecasting a hold on October 28th. The rate hike debate centres on the December 9th decision. Institutions like National Bank and Scotiabank are forecasting a 50 basis point hike on December 9th, while BMO and TD are forecasting no change through to the year’s end. Money markets are pricing in a partial increase as well. The September 2026 Consumer Price Index data released October 19th will be the most important input the governing council reviews before October 28th.
3. How does the October 28th Bank decision affect fixed and variable mortgage rates?
A rate hold on October 28th with neutral language would reduce the probability of a December hike and could ease the upward pressures on bond yields. This could slow or even reverse recent fixed-rate increases. A hold with hawkish language or an outright hike would push bond yields higher, leading lenders to raise fixed-rates further within days. Variable rates move only when the Bank of Canada changes its overnight rate. A hold on October 28th means no immediate variable rate change, regardless of the language used in the BoC’s announcement.
Sources and Methodology
• Bank of Canada 2026 rate announcement schedule — bankofcanada.ca/core-functions/monetary-policy/key-interest-rate
• True North Mortgage — Dan Eisner rate commentary September 15 2026 — truenorthmortgage.ca/blog/mortgage-rate-forecast
• Nesto — Canada mortgage rate forecast September 2026 — nesto.ca/mortgage-basics/mortgage-rates-forecast-Canada
• Perch — Canada interest rate forecast September 2 2026 — myperch.io/canada-interest-rate-forecast
• Bank of Canada — September 2 2026 rate decision — bankofcanada.ca
• Statistics Canada CPI July 2026 — released August 17 2026 — statcan.gc.ca
Related Resources:
• The Bank of Canada Just Held for the Seventh Time. But This Time It Said Something Different — Riley Brady
• The 2027 Bank of Canada Calendar: Eight Dates Every Canadian Borrower Should Know — Riley Brady
• Where Are Canadian Mortgage Rates Headed in 2027? What the Forecasts Say — Riley Brady
