By TD Economics

Key Takeaways:

• The Bank of Canada is set to make another rate announcement on June 4
• TD Economics predicts that the central bank will deliver two more rate cuts this year, though the exact timing is up in the air
• When the central bank cuts its rate, it can become cheaper for Canadians to borrow money
• If you’re a homeowner with a mortgage or someone looking to buy, you’ll likely be wondering what the Bank of Canada (BoC) is going to do this year when it comes to interest rates.

That’s because whenever the BoC cuts its lending rate, it can become cheaper for Canadians to borrow money. And when the BoC raises its lending rate, it can become more expensive.

According to TD Economics, the central bank might offer some rate relief in the coming months.

The ongoing softness in the labour market should open the door for the BoC to cut interest rates two more times this year, despite the recent uptick in inflation.

Amid trade tensions with the U.S., Andrew Hencic, Director and Senior Economist at TD Economics, said two cuts of 25 basis points each could help support the economy without putting too much more pressure on inflation. That means the current rate of 2.75% could come down to 2.25% by the end of the year.

“We think that enough slack has accumulated in the economy that there's space for the central bank to cut its lending rate a little bit more without too much inflationary pressure coming through,” Hencic said.

https://stories.td.com/ca/en/article/bank-of-canada-interest-rate-prediction-june-2025