Rate differentials · RBA vs BoC · priced as of 12 November 2026
AUD/CAD interest rate differential: RBA vs BoC
As of 12 November 2026, the AUD/CAD interest rate differential is +235 bp: the RBA's cash rate at 4.85% against the BoC's overnight rate at 2.50%, in favour of the Australian dollar. Markets price the gap at +197 bp in six months and +152 bp in twelve.
Over the next six months, markets price the gap to move −38 bp over six months, towards the Canadian dollar. That six-month gap has moved −10 bp in a month.
The rate spread, now and priced ahead
| RBA (AUD) | BoC (CAD) | Gap | |
|---|---|---|---|
| Policy rate now | 4.85% | 2.50% | +235 bp |
| Priced in 6 months | 4.88% | 2.91% | +197 bp |
| Priced in 12 months | 4.68% | 3.16% | +152 bp |
| 6-month gap a month ago | 4.82% | 2.75% | +208 bp |
The gap is AUD minus CAD, in basis points (100 bp is one percentage point). Six and twelve months out is the rate implied after each bank's last meeting on or before that date. Market pricing, not a forecast. Each bank's meeting-by-meeting odds: RBA · BoC.
The carry on AUD/CAD
The Australian dollar: the RBA pays 4.85% against 2.50%, a gap of +235 bp. Holding the higher-yielding currency against the lower earns roughly that gap a year before costs, which is what the carry trade collects; a move in the exchange rate can outweigh it.
How the gap feeds the exchange rate, and when it does not: rate differentials explained and the carry trade explained.
Questions
What is the AUD/CAD interest rate differential?
As of 12 November 2026, the AUD/CAD interest rate differential is +235 bp: the RBA's cash rate at 4.85% against the BoC's overnight rate at 2.50%, in favour of the Australian dollar. Markets price the gap at +197 bp in six months and +152 bp in twelve.
Is the RBA–BoC gap priced to widen or narrow?
Markets price the gap to move −38 bp over six months, towards the Canadian dollar, from +235 bp now to +197 bp. A month ago (13 October) the same six-month gap was priced at +208 bp, so it has moved −10 bp since. That is market pricing, not a forecast.
Which side of AUD/CAD has the carry?
The Australian dollar: the RBA pays 4.85% against 2.50%, a gap of +235 bp. Holding the higher-yielding currency against the lower earns roughly that gap a year before costs, which is what the carry trade collects; a move in the exchange rate can outweigh it.
Where does this pricing come from?
Each bank's priced path comes from the market instrument behind it: Exchange-traded futures, WatchTower model for RBA, Exchange-traded futures, WatchTower model for BoC. The rate six or twelve months out is the one implied after the last meeting on or before that date. The month-ago figure is from our daily snapshot of the same curves.
More on AUD/CAD: AUD/CAD analysis · AUD/CAD retail sentiment · AUD/CAD seasonality · Australian Dollar outlook · Australian Dollar COT positioning · RBA rate expectations · Australian economic surprises · Canadian Dollar outlook · Canadian Dollar COT positioning · BoC rate expectations · Canadian economic surprises
Other rate differentials: AUD/USD +85 bp · USD/CAD +150 bp · EUR/AUD −235 bp · EUR/CAD 0 bp · GBP/AUD −85 bp · GBP/CAD +150 bp · AUD/JPY +360 bp · AUD/NZD +210 bp · AUD/CHF +485 bp · CAD/JPY +125 bp · all 28
In WatchTower Terminal, the Rate spread panel draws the AUD/CAD gap against the price. Nothing here is financial advice.