Bank of Canada Rate Announcement Oct 25th, 2023

Tanya Toye • October 25, 2023

Bank of Canada maintains policy rate, continues quantitative tightening.

FOR IMMEDIATE RELEASE

October 25, 2023

The Bank of Canada today held its target for the overnight rate at 5%, with the Bank Rate at 5¼% and the deposit rate at 5%. The Bank is continuing its policy of quantitative tightening.

The global economy is slowing and growth is forecast to moderate further as past increases in policy rates and the recent surge in global bond yields weigh on demand. The Bank projects global GDP growth of 2.9% this year, 2.3% in 2024 and 2.6% in 2025. While this global growth outlook is little changed from the July Monetary Policy Report (MPR), the composition has shifted, with the US economy proving stronger and economic activity in China weaker than expected. Growth in the euro area has slowed further. Inflation has been easing in most economies, as supply bottlenecks resolve and weaker demand relieves price pressures. However, with underlying inflation persisting, central banks continue to be vigilant. Oil prices are higher than was assumed in July, and the war in Israel and Gaza is a new source of geopolitical uncertainty.

In Canada, there is growing evidence that past interest rate increases are dampening economic activity and relieving price pressures. Consumption has been subdued, with softer demand for housing, durable goods and many services. Weaker demand and higher borrowing costs are weighing on business investment. The surge in Canada’s population is easing labour market pressures in some sectors while adding to housing demand and consumption. In the labour market, recent job gains have been below labour force growth and job vacancies have continued to ease. However, the labour market remains on the tight side and wage pressures persist. Overall, a range of indicators suggest that supply and demand in the economy are now approaching balance.

After averaging 1% over the past year, economic growth is expected to continue to be weak for the next year before increasing in late 2024 and through 2025. The near-term weakness in growth reflects both the broadening impact of past increases in interest rates and slower foreign demand. The subsequent pickup is driven by household spending as well as stronger exports and business investment in response to improving foreign demand. Spending by governments contributes materially to growth over the forecast horizon. Overall, the Bank expects the Canadian economy to grow by 1.2% this year, 0.9% in 2024 and 2.5% in 2025.

CPI inflation has been volatile in recent months—2.8% in June, 4.0% in August, and 3.8% in September. Higher interest rates are moderating inflation in many goods that people buy on credit, and this is spreading to services. Food inflation is easing from very high rates. However, in addition to elevated mortgage interest costs, inflation in rent and other housing costs remains high. Near-term inflation expectations and corporate pricing behaviour are normalizing only gradually, and wages are still growing around 4% to 5%. The Bank’s preferred measures of core inflation show little downward momentum.

In the Bank’s October projection, CPI inflation is expected to average about 3½% through the middle of next year before gradually easing to 2% in 2025. Inflation returns to target about the same time as in the July projection, but the near-term path is higher because of energy prices and ongoing persistence in core inflation.

With clearer signs that monetary policy is moderating spending and relieving price pressures, Governing Council decided to hold the policy rate at 5% and to continue to normalize the Bank’s balance sheet. However, Governing Council is concerned that progress towards price stability is slow and inflationary risks have increased, and is prepared to raise the policy rate further if needed. Governing Council wants to see downward momentum in core inflation, and continues to be focused on the balance between demand and supply in the economy, inflation expectations, wage growth and corporate pricing behaviour. The Bank remains resolute in its commitment to restoring price stability for Canadians.

Information note

The next scheduled date for announcing the overnight rate target is December 6, 2023. The Bank will publish its next full outlook for the economy and inflation, including risks to the projection, in the MPR on January 24, 2024.

Read the October 25th, 2023 Monetary Policy Report.

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The Rise of Multi-Generational Homebuying

By Tanya Toye • May 23, 2026

As home prices continue to challenge affordability, more families are exploring creative ways to make homeownership possible. One option that has been growing in popularity is purchasing a single-family dwelling together. For some families, this approach can create opportunities that may not have been achievable individually, while also offering practical support across generations. Multi-family homeownership is not a one-size-fits-all solution but, in the right situation, it can work extremely well. Parents helping adult children enter the housing market, siblings purchasing together or families combining resources to care for aging relatives are all examples of scenarios where shared ownership can make sense. In many cases, a single-family dwelling or full duplex tends to be the preferred property type for this arrangement. Whether the property is freehold or leasehold, these options often provide the flexibility, privacy and living space families are seeking. A full duplex, in particular, can offer a balance between shared ownership and independent living, allowing family members to live close together while still maintaining separate spaces and routines. Combining incomes and down payment resources may improve purchasing power and help families qualify for properties that better meet their long-term needs. Shared expenses such as utilities, maintenance, property taxes and mortgage payments can also reduce the financial pressure that many households are currently experiencing. Careful planning required Purchasing property jointly is a major decision and requires careful planning. It’s important for everyone involved to have open conversations about finances, responsibilities, future plans and expectations before moving forward. Questions around ownership structure, exit strategies, inheritance considerations and ongoing costs should all be discussed early in the process. Legal and financial advice can be extremely valuable to ensure everyone understands their rights and obligations. Lenders will also evaluate the overall application differently when multiple borrowers are involved. Income sources, credit history, debt levels and the intended use of the property all play a role in financing approval. Working with you mortgage broker can help families understand available options and how to structure the purchase appropriately. For some families, buying together may provide a practical path toward stability, affordability and long-term wealth building. While it may not be the right fit for everyone, it’s becoming an increasingly common strategy for families looking to support one another and navigate today’s housing market together. Wondering if multi-generational living is right for you? I’m here to help explain all your options. 604-788-8693 | tanya@tanyatoye.ca

Why a Mortgage Pre-Approval Protects Both Your Head and Your Heart

By Tanya Toye • May 20, 2026

Why a Mortgage Pre-Approval Protects Both Your Head and Your Heart There’s no denying it—buying a home is an emotional journey. In a competitive market, it can feel like you need to stretch beyond your comfort zone or bid above asking just to have a chance. That pressure can make it hard to separate what you want from what you can realistically afford. One of the biggest pitfalls buyers face is falling in love with a home that’s outside their price range. Once that happens, every other property seems like a compromise—even the ones that might have been a perfect fit otherwise. The best way to avoid this heartache? Get pre-approved before you start shopping. What a Pre-Approval Does for You A mortgage pre-approval gives you more than just a number—it provides clarity, confidence, and protection: Know your buying power : Shop within your true price range and avoid disappointment. Spot potential roadblocks : Uncover issues like credit bureau errors before you make an offer. Get organized : Learn exactly what documentation you’ll need so there are no surprises. Lock in a rate : Many lenders hold your rate for 30–120 days, giving you peace of mind if rates rise. Save yourself heartache : Protect yourself from falling for a home you can’t afford. Head vs. Heart Buying a home is about balance. Your head tells you what’s financially sound, your heart tells you what feels right—and both matter. A pre-approval helps bring those two sides together, so you can make confident choices without emotional stress clouding your judgment. The Bottom Line Looking at properties for fun is one thing—but if you’re serious about buying, a pre-approval is the smartest first step you can take. It sets realistic expectations, saves time, and protects your emotions along the way. If you’d like to explore your options and get pre-approved, I’d be happy to walk through the process with you. Let’s make sure you’re ready to shop with confidence.