With the second Bank of Canada (BoC) rate announcement this year around the corner on March 12, many Canadians are eager to see if the central bank will cut its lending rate again.

In January, the BoC cut its lending rate by 25 basis points, bringing it down from 3.25% to 3%.

So, is more rate relief on the way? According to TD Economist Derek Burleton, the BoC is likely to cut its lending rate at the upcoming announcement by 25 basis points.

“We are anticipating a follow-up cut in March, and TD Economics predicts the central bank will bring its lending rate down to 2.75%,” Burleton said.

"Since the inflation data came out a few weeks ago, market odds of a cut fell as low as 30%, but have since jumped to 90% following the imposition of U.S. tariffs on Canadian exports. So, while there’s still a chance that the central bank will announce a rate hold, there is a growing consensus that a cut is in store.”

Burleton explained that the Bank of Canada needs to help prepare for the economic risks on the horizon – especially around tariffs.

"Even with recent reports showing a resilient job market and robust GDP growth in Canada, the central bank needs to ensure the economy is prepared for U.S. tariffs to hit Canadian exports,” he said.

https://stories.td.com/ca/en/article/will-bank-of-canada-cut-interest-rates-march-2025