Canadian Government Revises Economic Growth, Budget Deficit Forecasts

Canada's budget deficit is estimated at CAD 26.6 billion in 2019-20, higher than the previously forecast deficit of CAD 19.8 billion.

Arslan Butt•Tuesday, December 17, 2019•1 min read

While presenting his first update after the October elections, Finance Minister Bill Morneau expected the Canadian economy to grow at 1.7% in 2019 and slightly lower at 1.6% next year. In addition, the budget deficit is also expected to climb higher in 2020.

Canada’s budget deficit is estimated at CAD 26.6 billion in 2019-20, higher than the previously forecast deficit of CAD 19.8 billion. Morneau made these comments at a press conference, adding, “In 2020, we expect that we’re likely to be the second-strongest economy in terms of growth among G-7 countries.”

On the positive side, Morneau assured reporters that Canada has the lowest debt-to-GDP ratios among G7 countries at 31% and that there was no risk of a recession in the Canadian economy. The new government plans to increase the budget deficit to drive additional investments in infrastructure in a bid to boost the economic growth. In addition, Canadian PM Justin Trudeau also unveiled tax cuts for middle class consumers during the previous week.

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ABOUT THE AUTHOR See More

Arslan Butt

Index & Commodity Analyst

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.