RE:Canada’s in a stagflationary mess - Tiff Maclean should read Tiff Macklem
- Government "trade deficit" should read: fiscal deficit.
- unemployment right in second last paragraph should read
unemployment rate.
From Td:
Highlights
- In a budget intended to help Canada compete on a global stage during the energy transition, the government unveiled $67 billion in net new spending over the 5-year forecast horizon.
- About one-third was accounted for by the previously announced increase in health transfers, with the remainder focused on clean energy investment, dental care, and measures that were cited to address affordability in a high inflation environment.
- There will not be a return to fiscal balance. The deficit is expected to rise to $40 billion (1.4% of GDP) in the upcoming fiscal year, before shrinking but holding in the red at $14 billion (0.4%) by fiscal 2027-28. Accordingly, the debt-to-GDP ratio is slated to rise initially before heading lower to just below 40% by the end of the 5-year projection.
- The government’s forecast is based on cautious near-term economic assumptions, but fiscal projections remain vulnerable should the economy hit a deeper recession or stagnate into 2024.