The Bank of Canada’s decision to hold its overnight rate target steady at 2.25% through multiple 2026 meetings, including the July 15 announcement, underpins the 76% market-implied probability of no rate hike this year. Persistent economic slack, with growth only gradually absorbing excess supply, combined with core inflation measures anchored near the 2% target, has allowed the central bank to look through the temporary headline CPI spike to around 3% driven by oil-price volatility from Middle East developments. Consensus forecasts from major banks project the policy rate remaining unchanged for the balance of 2026 before any modest normalization toward neutral levels in 2027, reinforced by well-anchored longer-term expectations and muted underlying price pressures. The September 2 meeting and October Monetary Policy Report represent key near-term catalysts that could influence trader sentiment if data deviate from these projections.