As was widely expected, the Bank of Canada has held its benchmark overnight interest rate at 2.25%.
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Financial markets had priced in the hold by Canada’s central bank, with a majority of economists now forecasting that the Bank of Canada will leave interest rates unchanged for all of 2026. In prepared remarks, central bank governor Tiff Macklem said Canada’s economy is gradually recovering from U.S. tariff shocks but that more time is needed.
Macklem also warned that economic uncertainty remains “unusually high,” particularly related to geopolitical risks and the upcoming review of the Canada-U.S.-Mexico agreement on trade that is scheduled to take place this summer. He noted that the central bank’s governing council sees the current level of interest rates as “appropriate” based on the current economic outlook.
The Central Bank’s Outlook for 2026
Along with its latest interest rate decision, the Bank of Canada released updated forecasts for the economy and inflation over the coming years. The central bank says that Canada’s economy likely stalled in the fourth quarter of 2025.
The Bank of Canada expects that annual gross domestic product (GDP) growth averaged 1.7% in 2025. The central bank sees more modest growth of 1.1% in 2026 and 1.5% in 2027 as businesses adjust to new trade realities and U.S. tariffs.
Canada’s central bank is next scheduled to make a decision on interest rates on March 18 of this year.
Is SHOP Stock a Buy?
Let’s look at the stock of Shopify (SHOP), a leading Canadian company. It has a consensus Moderate Buy rating among 30 Wall Street analysts. That rating is based on 18 Buy and 12 Hold recommendations issued in the last three months. The average SHOP price target of $181.67 implies 31.43% upside from current levels.
