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Bank of Canada rate decision explained

What the Bank of Canada's interest rate decision is, when it lands in UK time, why it moves USD/CAD and how to manage risk around it.

Last updated: · By Forexuro Desk · Editorial policy

Published · Reviewed by the Forexuro Desk editorial team

What it is

The Bank of Canada sets its target for the overnight rate, the interest rate at which major Canadian financial institutions lend to each other overnight. The Bank targets 2% inflation, the midpoint of a 1 to 3% range. The Canadian dollar, nicknamed the loonie, is closely linked to the US economy, which buys most of Canada's exports, and to the price of crude oil.

Four of the eight decisions each year come with the Monetary Policy Report, the Bank's detailed forecasts, and a press conference with the Governor. Those meetings tend to carry more weight than the others.

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What to watch in the release

  • The overnight rate target. The rate and whether it moved by the expected amount.
  • The press release. The Governing Council's view of inflation, growth and the outlook, often read line by line for changes in wording.
  • The Monetary Policy Report. Quarterly forecasts published with four of the decisions.
  • The press conference. On report days, the Governor and Senior Deputy Governor answer questions shortly after the decision.

When it is released

Decisions are published at 9:45am Eastern time, which is usually 14:45 UK time, or 13:45 UK time in the short periods when the UK and North America change their clocks on different dates. There are eight scheduled decisions a year. The announcement lands during the London and New York overlap, the most liquid part of the day. Use the market sessions clock to convert times.

Why it moves markets

USD/CAD reflects the gap between Canadian and US interest rates, the price of oil and the health of the North American economy. A Bank that sounds more hawkish than expected tends to strengthen the loonie, pushing USD/CAD lower; a softer message tends to push it higher. As of 25 October 2026 the overnight rate target is 2.25%, held at the 2 September decision, and the next decision is on 28 October 2026 with the Monetary Policy Report, then 9 December 2026; current figures and sources are on our central banks page, and the week ahead is covered in the USD/CAD forecast.

Which pairs and gold it moves

  • USD/CAD: The main pair for Bank of Canada news.
  • XAU/USD: Little direct effect, but a Bank of Canada decision on the same day as US data can add to dollar moves.

How much any market moves depends on the size of the surprise and on what else is happening; there is no fixed reaction.

Bank of Canada rate decision in context

Because the Bank of Canada sometimes decides on the same day as the US Federal Reserve, as on 28 October 2026, USD/CAD can face two decisions within hours. In that case the first reaction to the Canadian decision can be overtaken by the Fed later in the evening, UK time. Holding a position through both doubles the event risk.

Canadian employment, CPI and GDP are the main local releases in the run-up, and the price of crude oil is a constant background driver. Trade relations with the United States also matter for the outlook, so the press release and the press conference often discuss trade as much as inflation.

How to trade around it carefully

  1. Check the exact release time and convert it to UK time with the market sessions clock. Daylight saving changes on different dates in the UK, North America, Europe and the southern hemisphere, so the UK time of the same local announcement shifts during the year.
  2. Know what the market expects. Prices react to the surprise against expectations, and to the guidance about the next meeting, more than to the rate itself.
  3. Check whether the Federal Reserve or major US data lands on the same day. For USD/CAD a second event can reverse the first move within hours.
  4. Decide in advance whether you will be flat, hold with reduced size or wait for the first move to settle. Many traders avoid opening new positions in the minutes before a decision.
  5. Expect wider spreads and possible slippage. Stops can be filled worse than their level when liquidity is thin; see slippage and gaps and weekend risk.
  6. Size down. If you hold through the release, a smaller position from the position size calculator keeps the money at risk within your plan.

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More events: FOMC rate decision · ECB rate decision · Bank of England rate decision · Bank of Japan rate decision · RBA rate decision · RBNZ rate decision · Bank of Canada rate decision · SNB rate decision · US CPI inflation · Non-farm payrolls (NFP)

Frequently asked questions

What time is the Bank of Canada decision in UK time?

The Bank of Canada announces at 9:45am Eastern time, which is usually 14:45 UK time and 13:45 UK time for a short period when the clocks change on different dates.

How often does the Bank of Canada set rates?

There are eight scheduled decisions a year, four of them with the Monetary Policy Report.

Why does oil matter for the Canadian dollar?

Crude oil is one of Canada's largest exports, so higher oil prices tend to support the Canadian dollar and lower prices tend to weigh on it.

Which pair reacts most to the Bank of Canada?

USD/CAD, the main pair for the Canadian dollar.

Education only, not financial advice. Trading forex, gold and CFDs carries a high risk of losing money, and leverage magnifies both gains and losses. Past performance is not a reliable guide to future results. Read our risk disclosure.