Interest rates have been lowered by two central banks and will facilitate lower rates for borrowers and fixed income investors.
On Wednesday September 17, 2025 in the morning, the Bank of Canada updated its monetary policy by cutting its policy interest rate by ¼ percent (25 basis points) to 2.50 percent. The Bank last adjusted rates on March 12, 2025, which had been its seventh consecutive interest rate announcement with a reduction.
The Bank’s statement indicated that “Canada’s GDP declined by about 1½% in the second quarter, as expected, with tariffs and trade uncertainty weighing heavily on economic activity.” To spur economic activity, including employment, it was time to lower interest rates, especially since the Consumer Price Index is at goal according to the latest StatsCan inflation release.
On Wednesday September 17, 2025 in the afternoon, the U.S. Federal Reserve took similar action to lower the federal funds rate to a range of 4 to 4¼ percent. The Fed’s statement began, “Recent indicators suggest that growth of economic activity moderated in the first half of the year. Job gains have slowed, and the unemployment rate has edged up but remains low. Inflation has moved up and remains somewhat elevated.”
The remaining interest rate announcements in 2025 for both the Bank of Canada and the Federal Reserve are scheduled on October 29th and December 10th. As of this date, the Fed is anticipating two more rate cuts before the end of this year.
Read more here:
Bank of Canada release CBC and interest rates
Federal Reserve release CNBC and Fed rates