The prime rate in Canada as of September 18, 2025, is 4.7%. This rate was recently decreased by 25 basis points from 4.95% following the Bank of Canada's decision to lower its overnight lending rate to 2.5% amid signs of weakening economic data and inflation below target.
This prime rate is used by major Canadian banks to set interest rates on variable loans and lines of credit including variable-rate mortgages. It typically follows the Bank of Canada's key interest rate closely, adjusting when the central bank changes its policy rate.
