MNI BoC Review-Jul 2026: Greater Comfort With The Status Quo

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EXECUTIVE SUMMARY 

• The Bank of Canada held the overnight rate at 2.25% for the 6th consecutive meeting in July.
• That was fully expected, though in a slight surprise the BOC’s prepared statements removed the previous reference to risk scenarios which would trigger either “consecutive” rate hikes (if oil price increases are sustained and impact broader inflation) or further cuts (in the event of significant US trade restrictions).
• Markets accordingly reacted marginally dovishly (around 1bp less tightening in 2026) to the statement release. However, Gov Macklem then said at the press conference that consecutive hikes or indeed further easing may still be needed.
• Overall while the statement changes confirmed that the BOC saw risks having receded since the last meeting, and the current level of rates is “appropriate”, Governing Council retains the option to move in either direction.
• Market-implied rates concluded the meeting seeing ~18bp of cumulative hikes through year-end, vs ~20bp pre-decision.

See PDF report for:

• MNI View
• MNI Instant Answers
• Press Conference Transcript
• BOC Meeting Links
• Policy Statement Changes
• Monetary Policy Report Update