Nomura Sees Bank of Canada to Remain on Hold Through 2026

11:43 AM EST, 12/30/2025 (MT Newswires) -- Nomura expects the Bank of Canada to maintain its policy rate of 2.25% through 2026.

While the balance of risks around growth remains skewed to the downside, the risk profile around inflation raises the bar for additional easing, wrote the bank in its "Global Macro Outlook 2026" note of ec. 11.

On net, Nomura assesses that the next move in policy rates is more likely to be a hike than a cut, particularly if recent strength in labor markets continues.

BoC Governor Tiff Macklem has mentioned that policy remains well-positioned to deal with any risks.

Nomura noted that the BoC's monetary policy framework review is underway and will be renewed in 2026. Officials have suggested the BoC will reevaluate its core inflation measures and assess how to improve communication about the underlying pace of inflation as part of the process.

Officials have also flagged the possibility of excluding mortgage interest costs, a component idiosyncratic to Canadian inflation calculations, from official measures in the future, Nomura said.

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