Personal loan interest rates in 2023
The first Bank of Canada rate announcement of 2023 occurred on January 25, 2023. The central bank raised its benchmark interest rate by one-quarter of a percentage point, bringing it to 4.5%. This was the eighth rate hike in less than 12 months.
After the rate hike on January 25, the Bank of Canada announced it would pause rate hikes conditionally to assess the impact of its increases on the economy. In the rate announcements that followed on March 8 and April 12, the central bank held steady, but on June 7 the bank raised the rate by a quarter percentage point and once again on July 12. On September 6, the bank held steady but stated it could increase the rate further as needed. On October 25, it held steady.
If you get a variable rate personal loan, your interest rate will go up, down or stay the same depending on what the Bank of Canada does. If your rate goes up, your monthly payment will generally stay the same, but more will go towards paying the interest vs principal, and it may take you longer to pay off your loan. If you get a fixed rate personal loan, your interest rate will stay the same throughout the life of the loan.