Bank of Canada Holds Interest Rate at 2.25%: What This Means for Airdrie Homeowners

By Shawn Mooney | Jan 28, 2026

The Bank of Canada made its first major move of 2026 this morning—by making no move at all.

The Bank of Canada released its latest interest rate decision on January 28, 2026. Read on to discover why they chose to hold the rate steady at 2.25% and what it means for your mortgage.

In a decision that was widely anticipated by economists, the Bank announced it is holding the overnight interest rate steady at 2.25%. While many homeowners were hoping for a cut to kick off the new year, this "pause" signals a shift in the economic landscape that every borrower in Airdrie and Calgary needs to understand.

Here is a breakdown of why the Bank hit pause, and specifically what this means for your variable rate mortgage or upcoming renewal.

Why Did the Bank of Canada Hold Rates?

The decision to hold the rate at 2.25% comes down to a tug-of-war between two key economic indicators: Inflation and Employment.

1. Inflation Ticked Up (2.4%): December’s inflation data showed a slight rise to 2.4%, just above the Bank’s 2% target. This was largely driven by higher costs in food and service sectors. This slight uptick gave the Bank a reason to be cautious and avoid cutting rates too quickly, which could reignite price growth.

2. Unemployment is Rising (6.8%): On the other hand, the Canadian job market is softening. Unemployment rose to 6.8% in December, indicating "slack" in the economy. This weakness suggests the economy isn't overheating, which prevents the Bank from needing to raise rates.

The Verdict: By holding rates steady, the Bank of Canada is adopting a "wait and see" approach to let these conflicting signals resolve before making their next move.

How This Affects Your Mortgage

As a Mortgage Broker in Airdrie, the most common question I am getting this morning is: "Does this mean I should lock in?" Here is how today's announcement impacts different types of borrowers:

1. If You Have a Variable Rate Mortgage

Because the prime rate remains unchanged, you will not see a change in your mortgage payment (or the interest portion of your payment) this month.

• The Good News: You are safe from hikes for now.

• The Reality: We likely won't see the aggressive rate cuts of 2025 continue in the first half of 2026. Stability is the new norm.

2. If You Are Renewing or Purchasing (Fixed Rates)

Fixed mortgage rates are driven by the bond market, not today's specific announcement. However, with the economy showing signs of slowing (GDP and unemployment), bond yields have remained relatively stable.

• Opportunity: If you are looking for mortgage rates in Alberta, fixed-term offers remain competitive. This period of stability is an excellent time to shop around without the fear of rates jumping overnight.

Strategic Advice for 2026

"No news" is actually good news for stability. We are entering a period where we can plan your finances with a bit more certainty than we had last year.

• Renewals: If your mortgage is up for renewal in 2026, don't wait for a rate drop that might be months away. Let's look at a short-term fixed rate that protects you now but leaves you flexible for the future.

• Debt Consolidation: With rates holding steady, using your home equity to consolidate higher-interest consumer debt (credit cards, lines of credit) remains one of the smartest financial moves you can make this quarter.

Looking for Honest Mortgage Advice?

Navigating the Canadian mortgage market requires more than just reading the headlines—it requires a strategy tailored to your financial goals.

Whether you need to crunch the numbers on a renewal or run a mortgage comparison, I am here to help.