2025 Interest Rate Forecast - 6 Major Canadian Banks
- Alex Leite
- Jul 21
- 2 min read
Here are the predictions from the six major Canadian banks regarding interest rates by the end of 2025.
By the end of 2025, the six major banks are all predicting slightly lower interest rates for Canadian mortgages, except Scotiabank, which believes rate cuts are done.
Bank | 2025 December Rate BoC Forecast | 2025 December 5-Year Bond Yield Forecast |
BMO | 2.25% | N/A |
CIBC | 2.25% | 2.85% |
National Bank | 2.00% | 2.50% |
RBC | 2.25% | 2.75% |
Scotiabank | 2.75% | 2.80% |
TD Bank | 2.25% | 2.95% |
Current BoC & 5-Year Yield | 2.75% | 3.04% |
Current Major Bank Prime Rate | 4.95% | N/A |
Notes: | The Bank of Canada (Boc) rate is not the rate you receive on the market. This rate determines what the major banks use for their prime rate. | The 5-year bond yield is not the interest rate you will receive from the bank. Banks add a 1.50-2.00% interest rate premium to the bond yield for the rate you receive. |
If you're worried you're not getting the best rate or want to discuss where rates might be heading, feel free to email me at alex@triedandtruemortgages.ca. I’d be happy to chat about your options and plans. Sometimes, a fresh perspective helps.
TL;DR:
All six major Canadian banks predict Bank of Canada rates to land in the 2.25%-2.75% range by December 2025.
Fixed rates may be near their low of 4.10%, while variable rates could drop to around 3.75%.
These forecasts suggest that a variable rate might be the right option for you if you're comfortable with it. Otherwise, you can't go wrong with a fixed rate at the moment.
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