Fed Hike Odds Jumped to 80% in a Week. The Bank of Canada's Math Has Not Changed

Step chart showing the Bank of Canada's overnight rate holding steady at 2.25% through six consecutive decisions into July 2026.

The Bank of Canada has held its overnight rate at 2.25% for six consecutive decisions, the endpoint of a cutting cycle that began in June 2024. That steady path stands in contrast to the US Federal Reserve, where futures markets now price an 80% chance of a December rate hike, up from 73% a week earlier, as rising gasoline prices push up US inflation expectations. Canada's own June inflation reading eased to 2.8%, giving the Bank room to hold steady while the US grapples with a different inflation picture.

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Line chart tracking the market-implied probability the US Federal Reserve holds rates steady in September 2026.

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