Canada - Monetary Policy Rate

Canada: Monetary Policy Rate

Mnemonic IRMP.ICAN
Unit %, NSA
Adjustments Not Seasonally Adjusted
Business Daily
Data 03 Apr 2023 4.5
31 Mar 2023 4.5

Series Information

Source Bank of Canada
Release Canadian Bank Rate Announcement (Monetary Policy)
Frequency Business Daily
Start Date 12/1/1992
End Date 4/3/2023

Canada: Markets

Reference Last Previous Units Frequency
Lending Rate 03 Apr 2023 4.75 4.75 %, NSA Business Daily
Monetary Policy Rate 03 Apr 2023 4.5 4.5 %, NSA Business Daily
Average Long-term Government Bond 30 Mar 2023 3.03 3.04 %, NSA Business Daily
Treasury Bills (over 31 days) 30 Mar 2023 4.33 4.31 %, NSA Business Daily
Stock Market Index 29 Mar 2023 19,837 19,657 Index, NSA Daily
Money Market Rate 28 Mar 2023 4.5 4.5 %, NSA Business Daily
Household Lending Rate Sep 2019 10 10 %, NSA Monthly

Release Information

For Canada, key interest rates: Interbank overnight market, CORRA, government bond yields by tenor, commercial paper. Daily.

  • Measurement: Percent per annum (% p.a.)
  • Adjustment: Not seasonally adjusted (NSA)
  • Native frequency: Business daily
  • Start date: As early as 1962

The source writes:

Interbank overnight market

THE TARGET FOR THE OVERNIGHT RATE is the main tool used by the Bank of Canada to conduct monetary policy. It tells major financial institutions the average interest rate the Bank of Canada wants to see in the marketplace where they lend each other money for one day, or "overnight." When the Bank changes the Target for the Overnight Rate, this change usually affects other interest rates, including mortgage rates and prime rates charged by commercial banks.

Canada's major financial institutions routinely borrow and lend money among themselves overnight, in order to cover their transactions during the day. Through the Large Value Transfer System (LVTS), these institutions conduct large transactions with each other electronically. At the end of the day, the financial institutions need to settle with each other. One bank may have funds left over at the end of this process, while another bank may need money. The trading in funds that allows all the institutions to cover their transactions is called the overnight market. The interest rate charged on those loans is called the overnight rate.

The Bank of Canada operates a system to make sure trading in the overnight market stays within its "operating band." This band, which is one-half of a percentage point wide, always has the Target for the Overnight Rate at its center. For example, if the operating band is 4.25 to 4.75 per cent, the Target for the Overnight Rate would be 4.50 per cent. Since the institutions know that the Bank of Canada will always lend them money at the rate at the top of the band, and pay interest on deposits at the bottom, there is no reason for them to trade funds at rates outside the band.

The Bank can also intervene in the overnight market at the Target rate, if the market rate is moving away from the Target. The Target sets the trend. When the Bank changes the Target for the Overnight Rate, this sends a clear signal about the direction in which it wants short-term interest rates to go. These changes usually lead to moves in the prime rate at commercial banks, which serves as a benchmark for many of their loans. These changes can also indirectly affect mortgage rates, and the interest paid to consumers on bank accounts, GICs, and other savings.

When interest rates go down, people and businesses are encouraged to borrow and spend more, boosting the economy. But if the economy grows too fast, it can lead to inflation. The Bank may then raise interest rates to slow down borrowing and spending, putting a brake on inflation. In choosing a Target for the Overnight Rate, the Bank of Canada picks a level that it feels will keep future inflation low, stable and predictable. Keeping inflation low and stable helps provide a good climate for sustainable economic growth, investment and job creation.

The data for the 10-year rate refers to the par yield rates. “Long term (in most cases 10 year) government bonds are the instrument whose yield is used as the representative ‘interest rate’ for this area. Generally the yield is calculated at the pre-tax level and before deductions for brokerage costs and commissions and is derived from the relationship between the present market value of the bond and that at maturity, taking into account also interest payments paid through to maturity.” (

International comparability

When comparing Canada's official interest rates with those of other countries, the Target for the Overnight Rate is the best rate to use. It is directly comparable with the U.S. Federal Reserve's target for the federal funds rate, the Bank of England's two-week "repo rate," and the minimum bid rate for refinancing operations (the repo rate) at the European Central Bank.


The Canadian overnight repo rate (CORRA) is the weighted average rate of overnight general (non-specific) collateral repo trades that occurred through designated inter-dealer brokers and the Canadian Derivatives Clearing Corporation's central counterparty system between 6:00 a.m. and 4:00 p.m. on the specified date as reported to the Bank of Canada. The list of contributors, as recognized by the Investment Industry Association of Canada (IIAC), includes Freedom International Brokerage Inc., Tullett Prebon (Canada) Ltd. and Shorcan Brokers Ltd. Although the data is believed to be reliable, the Bank of Canada does not guarantee its accuracy or completeness. As approved by the IIAC, in the event that less than $500 million in eligible overnight trades are reported, CORRA will be set at the Bank of Canada's target for the overnight rate.

Effective 15 June, 2020, the Bank of Canada has replaced Refinitiv as the administrator of CORRA. Concurrent with this change, the Bank of Canada adopted a new methodology for calculating CORRA. Historical data has not been revised, however, the data exhibits a break in methodology at 12 June 2020.

Data is final when posted and generally not subject to revision.