The Bank of Canada raised its rate to 2.50%. What would make you trade the loonie?

The Bank of Canada raised its target for the overnight rate by 25 basis points, from 2.25% to 2.50%, with the announcement dated 28 October 2026. The bank's key interest rate page shows the new target and that date (Bank of Canada: key interest rate). Our write-up of the decision lists the same figures (the decision).

Canada's September consumer prices rose 3.1% on the year, and that is the reading to set against the decision (Canada's September CPI). The bank's earlier reasoning on the 2.25% rate is in the BoC trade-off analysis. Both matter for how far the loonie moves: the size of the move, and whether the bank signals more to come. The bank's own statement is the place to check which of those drove the decision.

We would like to hear your view:

• Do you trade the Canadian dollar on the rate change itself, or on what the bank says next?
• Which Canadian release do you check before the next decision?
• When the Fed holds and the Bank of Canada hikes, which pair do you watch first?
• Have you seen the loonie move on a rate decision and give it back the same day?

For how inflation feeds into currencies in general, see how inflation moves currencies.

Please share your own approach and reasoning, not calls for others to copy. Posts that promise a direction or sell signals will be removed.