Canada Budget Deficit Gdp

Canada's Economy Outperforms Expectations: Deficit Projections Revised

Strong Economic Fundamentals Drive Fiscal Consolidation

The Bank of Canada's forecast in the April Monetary Policy Report predicts significant economic growth for Canada in the coming years. With GDP expected to surpass initial budget projections, the anticipated deficits for 2023 and 2024 are likely to be reduced, according to Jean-François St-Arnaud, the Parliamentary Budget Officer.

Budgetary Deficits Decline in Recent Years

In 2022-23, the budgetary deficit decreased to 13% of GDP, a marked improvement from the 36% deficit recorded the previous year (2021-22). The budgetary deficit before net actuarial losses also saw a decline, from 32% of GDP in 2021-22 to 0.9% in 2022-23.

Canada's Fiscal Consolidation Outpaces G7 Peers

As a result of the government's economic plan, Canada has achieved the fastest fiscal consolidation rate within the G7 since the height of the pandemic. The country maintains the lowest deficit-to-GDP and net debt-to-GDP ratios among all G7 nations.

Economic Resilience in the Face of Global Slowdown

Despite higher interest rates, Canada has avoided the anticipated recession. Inflation has been steadily decreasing, reaching 2.8% in February 2024, a significant improvement from its peak of 8.1% in June 2022. Canada's economic resilience is attributed to robust population growth, a thriving labor market, and a well-regulated financial system.

Budget 2024: Fiscal Responsibility and Growth

Budget 2024 aligns with the fiscal objectives outlined in the 2023 Fall Economic Statement. It prioritizes maintaining Canada's low deficit-to-GDP and net debt-to-GDP ratios while supporting economic growth and ensuring financial sustainability.