Canada Unveils 2026 Budget With C$45 Billion Housing Plan, Higher Borrowing and Slower Growth Outlook

Canada's 2026 budget includes C$45 billion in housing affordability measures and C$25 billion to establish a new Canada Growth Fund Canada forecasts 2026 GDP growth of 1.0%, down from 1.1% previously, and 2027 growth of 1.7%, down from 1.9% Canada projects a 2027/28 budget deficit of C$62.5 billion, compared with C$63.1 billion forecast in April Federal debt-to-GDP ratio expected at 39.9% in 2026/27, rising to a peak of 40.4% in 2028/29, before easing to 40.1% by 2030/31 Canada plans to borrow C$611 billion in 2027/28, up from C$587 billion in 2026/27, with 72% of total borrowing used to refinance maturing debt Canada plans C$316 billion in bond issuance and C$290 billion in Treasury bill issuance for 2027/28 Canada to increase Treasury bill issuance by C$16 billion in the current fiscal year Public debt charges projected at C$60.2 billion in 2026/27, rising from 1.8% of GDP to 2.2% by 2030/31 Canada maintains permanent resident immigration target at 380,000 annually for the next three years Budget includes tax incentives for successful startups and maintains commitment to regular green bond issuance Canada renews monetary policy framework with the Bank of Canada, reaffirming price