Bank of Canada holds interest rate at 2.75% in April 2025: Employee rights

What did the Bank of Canada do?

On April 16, 2025, the Bank of Canada (BoC) held its key interest rate at 2.75 per cent.

The Bank Rate remains at three per cent, while the deposit rate was left unchanged at 2.70 per cent.

“The major shift in direction of U.S. trade policy and the unpredictability of tariffs have increased uncertainty, diminished prospects for economic growth, and raised inflation expectations,” the central bank said in a news release.

“Pervasive uncertainty makes it unusually challenging to project GDP growth and inflation in Canada and globally.”

The BoC’s Governing Council is monitoring the following risks:

• The extent to which higher tariffs reduce demand for Canadian exports.
• How much the trade conflict spills over into business investment, employment, and household spending.
• How much and how quickly cost increases from the trade conflict are passed on to consumer prices.
• How inflation expectations evolve due to current economic uncertainty.

Pause after consecutive rate cuts

The central bank’s decision to leave its key interest rate unchanged comes after its seventh consecutive rate reduction on March 12, 2025.

For a complete list of interest rate changes and detailed insights, visit our full rate change list.

Key highlights from the announcement

• Financial markets have experienced significant volatility due to serial tariff announcements, postponements, and continued threats of escalation. However, Canada’s exchange rate has recently appreciated as a result of broad U.S. dollar weakness.
• Oil prices have declined substantially since January. Lower prices globally is expected to dampen inflation in the near term.
• Consumption, residential investment, and business spending all look to have weakened in the first quarter of 2025 due to the ongoing trade conflict.
• Employment declined in March and businesses are reporting plans to slow their hiring due to trade tensions. Wage growth continues to show signs of moderation.
• Consumer price index (CPI) inflation will be pulled down for one year, starting in April, by the removal of the consumer carbon tax.

When is the next rate announcement?

The next interest rate announcement from the Bank of Canada is scheduled for June 4, 2025.

How does this affect employment?

The BoC’s decision to keep interest rates lower is aimed at stimulating business activity and consumer spending, which will hopefully lead to increased hiring.

However, the overall impact on employment will depend on how the broader economy reacts to lower rates, inflation, and U.S. trade uncertainty.

Lost your job?

In the event that you’re fired or let go, it’s crucial to understand your employment rights in Canada.

Non-unionized employees can get up to 24 months of severance pay when they lose their job. This includes individuals working full-time, part-time, or hourly in Ontario, Alberta, and British Columbia.

Severance is the compensation Canadians receive from their employer when they are fired without cause.

• Fired for cause? It’s very likely that you are still entitled to full severance pay because employees often don’t meet the conditions necessary for this type of dismissal.

Regardless of a company’s grasp on employment law, they are legally required to provide proper compensation following a termination.

This concept applies during challenging economic conditions, downsizing, the closure of a business, or major public health events such as the COVID-19 pandemic.

WATCH: Employment lawyer Lior Samfiru shares five fast facts about termination without cause on an episode of the Employment Law Show.

Talk to an employment lawyer

If you’ve been fired or let go for any reason, contact the experienced employment law team at Samfiru Tumarkin LLP.

We’ve successfully represented tens of thousands of non-unionized workers in Ontario, Alberta, and B.C.

In addition to severance package negotiations, our lawyers can assist you on a broad range of employment matters, including:

Contact us or call 1-855-821-5900 to get the advice you need and the compensation you deserve.