Bank of Canada raises interest rates for the first time in three years

The central bank increased key rate by a quarter point as soaring energy prices push up inflation.Published On 28 Oct 202628 Oct 2026The Bank of Canada (BoC) has raised its key interest rate for the first time in more than three years and warned that further increases might be needed to prevent soaring energy costs from fueling broader inflation.Wednesday’s quarter-point hike to 2.5 percent was widely expected, while the bank also ramped up its inflation forecast for 2027 to 3.1 percent from the 2 percent it had predicted in July. Growth this year is set to be 1 percent, higher than the 0.7 percent seen in July.Recommended Stories list of 4 itemslist 1 of 4Canada, US and tit-for-tat tariffs: How will they impact their economies?list 2 of 4Brent crude surpasses $100 a barrel as Iran, US escalate attackslist 3 of 4G7 nations to release oil and diesel stocks, will it bring down the prices?list 4 of 4What is potash, and why is the US importing it from Belarus?end of list“With the outlook for inflation substantially higher and the economy showing resilience, an increase in the policy rate is needed to reduce the risk that elevated energy prices could spill over and become generalised in...