Freeland previously committed to self-imposed fiscal guardrails, including keeping the debt-to-GDP ratio on a downward path and ensuring the deficit-to-GDP ratio remains below one percent by 2026-27.
The fall statement projects the federal debt-to-GDP ratio at 42.1 percent for 2023-24, with forecasts showing it declining to 41.9 percent next year.
However, fiscal policy expert Fred O’Riordan, tax policy leader at EY Canada, cautioned that the government’s outlook may be “overly optimistic.”
Projections are based on private sector forecasts from September, which do not account for Trump’s recent tariff threats.
“The forecast is quite likely overly optimistic, even the downside scenario, in light of the threat of tariffs from the US and how Canada may respond,” he said.
