The Bank of Canada has kept benchmark rates unchanged as it balances persistent inflation risks with slowing economic growth. Higher energy prices, driven by tensions in the Middle East, continue to fuel inflation, while trade uncertainty weighs on the broader economy. Together, these factors suggest interest rates could remain on hold for a longer period.
The current environment creates an attractive opportunity for income-focused investors. As interest rates stabilize, the appeal of many fixed-income investments fades. By contrast, high-quality dividend stocks with attractive yields can provide dependable income, the potential for regular dividend growth, and a measure of protection against inflation.
Further, if interest rates eventually begin to decline, investors who lock in today’s higher dividend yields could be well positioned to benefit.
With the Bank of Canada not in a rush to change course, here are two top Canadian dividend stocks that look built for the rate pause.
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Dividend stock #1: Enbridge
With the central bank signalling that interest rates are likely to remain on hold, investors seeking reliable passive income while staying ahead of inflation should consider Enbridge (TSX:ENB). It has paid dividends for over 70 consecutive years and has increased its payout every year since 1995. Moreover, this Canadian energy infrastructure company offers a compelling yield of 5.1%.
Most of Enbridge’s earnings come from regulated assets and long-term contracts. This operating structure adds stability, makes it relatively immune to commodity price fluctuations, and enables it to generate solid cash flows.
Looking ahead, Enbridge’s dividend appears well protected. Enbridge maintains a sustainable payout ratio. Further, it will continue to grow its earnings and distributable cash flow (DCF) at a healthy pace, supporting higher distributions.
Management projects 2026 EBITDA of $20.2 billion to $20.8 billion, along with growth in DCF and earnings per share. Beyond 2026, Enbridge’s earnings and cash flow could grow by about 5% annually, providing a solid foundation for consistent dividend growth.
Enbridge’s multi-billion-dollar capital projects, supported by regulated frameworks or long-term contracts, provide excellent visibility into future revenue. Meanwhile, Enbridge is set to benefit from rising energy demand driven by AI-powered data centres.
With dependable cash flows, a proven dividend growth record, multiple long-term growth catalysts, and a compelling yield, Enbridge is a solid stock to buy while rates are on hold.
Dividend stock #2: SmartCentres REIT
SmartCentres REIT (TSX:SRU.UN) is an attractive income stock to consider while interest rates remain on hold. The REIT pays a monthly distribution of $0.15 per unit, yielding more than 6%.
Its distributions are supported by its high-quality retail and mixed-use properties, which are witnessing strong leasing demand, high occupancy, and generating steady net operating income (NOI), thereby supporting reliable cash flow. Moreover, a financially strong tenant base also helps keep rent collections stable and reduces earnings volatility.
SmartCentres’s in-place and committed occupancy remained high at 97.6% at the end of Q1. Further, rent collections were strong at about 99%. Leasing momentum also remained strong. The REIT has completed about 80% of its 2026 lease renewals, with renewal rents rising 11.5% excluding anchor tenants.
Looking ahead, SmartCentres is well-positioned to deliver steady growth. Ongoing portfolio optimization, a large development pipeline, and its extensive underutilized land bank should support higher funds from operations and help sustain distributions.
