Canada's Fiscal Deficit Will Remain Wide In Coming Years As Government Enacts More Stimulus

• Canada’s budget deficit will be structurally wider over the coming quarters as Prime Minister Justin Trudeau’s government increases public spending on social programs and investment over the next three years to support economic recovery.
• Fitch Solutions forecast a budget deficit of 8.7% of GDP in the fiscal year 2021/2022 and 8.5% in FY2022/2023, from an estimated 16.0% shortfall in FY2020/2021.
• While significantly larger deficits will push up public debt to 53.9% of GDP in 2021 and 57.6% in 2022, the country’s debt load will remain smaller than many other developed market economies, helping to keep borrowing costs low.

(Source: Fitch Solutions)