The Bank of Canada announced today that it would maintain the overnight rate target at 2.75%, with the bank rate at 3% and the deposit rate at 2.70%. This marks the first pause after seven consecutive interest rate cuts, and the bank stated that due to the uncertainty surrounding U.S. tariffs, it could not provide a clear economic forecast as usual.

The bank said that due to a significant shift in U.S. trade policy and increased uncertainty regarding tariff policies, the global economic outlook has become more uncertain, with downward growth expectations and upward inflation expectations. The widespread uncertainty makes it exceptionally difficult to forecast GDP growth and inflation for both Canada and the global economy.

Source: Global News

As a result, this April Monetary Policy Report (MPR) did not present a single forecast but envisioned two different scenarios for the development of U.S. trade policy:

  • In the first scenario, despite high uncertainty, if the scope of tariffs is limited, Canada's economic growth will experience a temporary slowdown, but inflation will remain near the 2% target.
  • In the second scenario, if the trade war escalates further, Canada's economy will enter a recession this year, and inflation may temporarily rise above 3% next year.

Moreover, there are many other possible evolutions of trade policy. Even under any of these scenarios, due to the unprecedented speed and magnitude of changes in U.S. policies, the economic consequences themselves are highly uncertain.

Source: 51 journalist shot

In today's press release, the Bank of Canada stated that the bank will continue to assess the dynamic balance between the downward pressure on inflation caused by an economic slowdown and the upward pressure on inflation caused by rising costs. The focus is to ensure Canadians' confidence in price stability during this global turmoil. This means we will support economic growth while ensuring inflation remains well controlled.

With the ongoing escalation of the trade war between Canada and the United States, the central bank's policy decisions have become even more complex. On Tuesday, Statistics Canada released data showing that the national annual inflation rate had dropped to 2.3%. However, the bank also warned that it cannot address both challenges simultaneously—the economic impact of trade disputes and the resulting rise in prices.

The Canadian dollar surged back to its five-month high!

On Wednesday, due to a weakening U.S. dollar and the Bank of Canada's decision to halt further interest rate cuts, the Canadian dollar strengthened against the U.S. dollar.

The Canadian dollar rose by 0.6%, reaching 1 USD = 1.3875 CAD, or approximately 72.07 cents, nearing the five-month high (1.3827) reached on Monday.

Additionally, the Canadian dollar also surged against the Chinese yuan today, increasing by 0.64%, reaching 5.2983, almost breaking through 5.30.

Source: Google

Market expectations suggest that there is about a 50% probability that the Bank of Canada will resume interest rate cuts at its next meeting on June 4th, with possibly two more rate cuts this year.

TD Securities strategists Jayati Bharadwaj and others stated in their report: "The Bank of Canada's decision to keep interest rates unchanged provides support for the Canadian dollar. With the U.S.-Canada trade conflict not worsening further and Trump shifting his attention to China, the Canadian dollar's price performance may be more stable, and market positions continue to improve."

Source: 51 journalist shot

Data released last Friday by the U.S. Commodity Futures Trading Commission (CFTC) showed that investors' bearish bets on the Canadian dollar have fallen to their lowest level since October last year.

Meanwhile, rising oil prices have also supported the Canadian dollar. Due to new U.S. sanctions on Iranian oil imports from China, crude oil prices rose by 1.8%, reaching $62.45 per barrel. Oil products are one of Canada's main exports.

Bank of Canada 'holds steady'

is a major blow to the real estate market!

Canadian real estate experts stated that the Bank of Canada's decision to keep the key interest rate at 2.75% unchanged means that the already sluggish real estate market will continue to remain in a "stagnant" state.

Veteran mortgage and real estate expert Victor Tran pointed out that in the current economic environment, consumer confidence in large expenditures such as home loans is not high, and this decision to "hold steady" will not generate much market enthusiasm.

He said: "The real estate market has been sluggish for several months, and this spring market is far less active than previous years, and this decision to hold interest rates steady will not bring about significant changes."

Previously, due to multiple interest rate cuts, the housing market briefly warmed up at the end of last year, and many economists predicted that the housing market would steadily recover in 2025. However, the sudden U.S.-Canada trade war has dampened market confidence, and this expectation has not come true.

Source: 51 journalist shot

Mortgage expert Penelope Graham of Ratehub.ca noted that for buyers with floating-rate mortgages, today's decision by the central bank will not affect monthly payment amounts or interest expenses.

She said: "Today's decision to hold interest rates steady will not rekindle homebuyers' enthusiasm, especially given the current uncertainty surrounding tariffs."

"In times of market volatility, whether planning to buy a home or renewing a mortgage, one should apply for loan pre-approval as soon as possible, which can lock in the current interest rate for up to 120 days, helping to mitigate risks associated with short-term interest rate fluctuations."

Tran also mentioned that if the expected two interest rate cuts this year actually materialize, the real estate market might see a rebound in the future, as this would further lower floating mortgage rates.

"However, this is still unpredictable, as home buying trends will be influenced by the overall economic environment, and we currently lack a clear understanding of the future economic direction."

At the same time, he pointed out that although the bond market has been volatile, fixed-rate loans have not seen significant changes. If bond yields continue to rise, fixed-rate mortgages may increase accordingly.

Average price of detached homes in Greater Toronto fell by over $300,000

Condos fell by $80,000!

Toronto Real Estate Board (TRREB) released its monthly housing report half a month ago, and 51 Find House exclusively released the statistics for the first half of April 2025. Data shows that the average house prices in all types of properties in the Greater Toronto Area have fallen. The average price of single-family homes has dropped by more than double digits, with the average price of detached houses at CAD 990,000, a 18.9% drop compared to CAD 1.22 million last year.

Data shows that as of April 15, the average house prices in all types of properties in the Greater Toronto Area have fallen:

  • The average price of detached houses has fallen the most, by 18.9%, from an average of CAD 1.22 million last April to CAD 990,000 this April, a net decrease of CAD 230,000;
  • All types of apartment properties have experienced the smallest decline, with a net decrease of CAD 80,000, a 11.6% drop;
  • Semi-detached houses have decreased by CAD 150,000, a 14.3% drop;
  • Townhouses have decreased by CAD 130,000, a 14.9% drop.

In Markham, where there is a large Chinese population, the average price of detached houses is CAD 1.65 million, a 9.84% drop from CAD 1.83 million last year, a net decrease of CAD 180,000.

The average price of detached houses in Richmond Hill is CAD 1.94 million, a 7.18% drop from CAD 2.09 million last year, a net decrease of CAD 150,000.

Brock leads the list with the highest percentage drop, with an average price of CAD 620,000 in the first half of April, a 31.87% drop from CAD 910,000 last year, a net decrease of CAD 290,000.

Burlington ranks second on the list, falling sharply from CAD 1.62 million last April to CAD 1.30 million, a 19.75% drop, a net decrease of CAD 320,000. Mississauga follows closely behind with a 18.9% drop, a net decrease of CAD 310,000.

Pickering tops the list with an 8.26% increase. Vaughan and Scugog follow closely with increases of 8.2% and 7.62%, respectively.

According to 51 Find House statistics, the number of listed properties in the Greater Toronto Area in the first half of April was 33,489, an increase of 53% compared to 21,882 last year.

The average listing period is 30 days, compared to 23 days last year.

51 Find House statistics show that the average price of detached houses has fallen in 20 municipalities in the first half of April.

Original article: https://www.toutiao.com/article/7493992772060398080/

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