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Interest Rate Outlook

F: Forecast by TD Economics, June 2026. All forecasts are end-of-period.
Source: Bloomberg, Bank of Canada, Federal Reserve, TD Economics.
Interest Rates 2025 2026 2027
Q1 Q2 Q3 Q4 Q1 Q2F Q3F Q4F Q1F Q2F Q3F Q4F
Canada                        
Overnight Target Rate  2.75 2.75 2.50 2.25 2.25 2.25 2.25 2.25 2.25 2.25 2.25 2.25
3-mth T-Bill Rate  2.62 2.65 2.42 2.15 2.31 2.25 2.25 2.25 2.25 2.25 2.25 2.25
2-yr Govt. Bond Yield  2.46 2.59 2.47 2.58 2.82 2.75 2.75 2.65 2.60 2.60 2.60 2.60
5-yr Govt. Bond Yield  2.61 2.83 2.74 2.96 3.09 3.10 3.00 2.95 2.90 2.90 2.90 2.90
10-yr Govt. Bond Yield  2.97 3.28 3.17 3.42 3.46 3.40 3.35 3.30 3.25 3.25 3.25 3.25
30-yr Govt. Bond Yield  3.23 3.56 3.62 3.86 3.89 3.80 3.70 3.60 3.55 3.55 3.55 3.55
10-yr-2-yr Govt Spread 0.51 0.69 0.70 0.84 0.64 0.65 0.60 0.65 0.65 0.65 0.65 0.65
U.S.                         
Fed Funds Target Rate  4.50 4.50 4.25 3.75 3.75 3.75 3.75 3.75 3.50 3.25 3.25 3.25
3-mth T-Bill Rate  4.21 4.24 3.86 3.57 3.61 3.70 3.65 3.55 3.30 3.15 3.15 3.15
2-yr Govt. Bond Yield  3.89 3.72 3.60 3.47 3.79 4.00 3.80 3.60 3.35 3.35 3.35 3.35
5-yr Govt. Bond Yield  3.96 3.79 3.74 3.73 3.92 4.20 3.85 3.75 3.70 3.70 3.70 3.70
10-yr Govt. Bond Yield  4.23 4.24 4.16 4.18 4.30 4.45 4.25 4.15 4.10 4.10 4.10 4.10
30-yr Govt. Bond Yield  4.59 4.78 4.73 4.84 4.88 5.05 4.80 4.65 4.60 4.60 4.60 4.60
10-yr-2-yr Govt Spread 0.34 0.52 0.56 0.71 0.51 0.45 0.45 0.55 0.75 0.75 0.75 0.75
Canada - U.S. Spreads                        
Can - U.S. T-Bill Spread -1.59 -1.59 -1.44 -1.42 -1.30 -1.45 -1.40 -1.30 -1.05 -0.90 -0.90 -0.90
Can - U.S. 10-Year Bond Spread -1.26 -0.96 -0.99 -0.76 -0.84 -1.05 -0.90 -0.85 -0.85 -0.85 -0.85 -0.85

 

Foreign Exchange Outlook

F: Forecast by TD Economics, June 2026. All forecasts are end-of-period.
Source: Bloomberg, Bank of Canada, Federal Reserve, TD Economics.
Currency Exchange Rate 2025 2026 2027
Q1 Q2 Q3 Q4 Q1 Q2F Q3F Q4F Q1F Q2F Q3F Q4F
Exchange Rate to U.                          
 Euro USD per EUR 1.08 1.18 1.17 1.17 1.15 1.15 1.17 1.19 1.20 1.20 1.20 1.20
 UK Pound USD per GBP 1.29 1.37 1.34 1.35 1.32 1.33 1.35 1.38 1.39 1.39 1.39 1.39
 Japanese Yen JPY per USD 149.9 144.2 148.0 156.8 159.1 160.0 159.4 158.7 158.1 157.5 156.8 156.2
 Chinese Renminbi CNY per USD 7.26 7.16 7.12 6.99 6.90 6.85 6.80 6.75 6.70 6.65 6.60 6.55
Exchange Rate to Ca                          
 U.S. Dollar USD per CAD 0.70 0.73 0.72 0.73 0.72 0.71 0.73 0.74 0.75 0.75 0.75 0.75
 Euro CAD per EUR 1.55 1.60 1.63 1.61 1.61 1.61 1.62 1.62 1.61 1.60 1.60 1.60
 UK Pound CAD per GBP 1.85 1.87 1.87 1.84 1.84 1.86 1.87 1.88 1.86 1.85 1.85 1.85
 Japanese Yen JPY per CAD 104.2 105.9 106.2 114.4 114.0 114.3 115.5 116.7 118.0 118.4 117.9 117.4
 Chinese Renminbi CNY per CAD 5.05 5.26 5.11 5.10 4.95 4.89 4.93 4.96 5.00 5.00 4.96 4.93

 

Commodity Price Outlook

F: Forecast by TD Economics, June 2026. All forecasts are period averages.
Source: Bloomberg, TD Economics, USDA (Haver).
Commodity 2025 2026 2027
Q1 Q2 Q3 Q4 Q1 Q2F Q3F Q4F Q1F Q2F Q3F Q4F
Crude Oil (WTI, $US/bbl) 72 64 65 59 72 94 89 82 77 75 73 72
Natural Gas ($US/MMBtu) 4.20 3.19 3.03 3.76 4.62 2.90 3.25 3.75 3.65 3.50 3.50 3.50
Gold ($US/troy oz.) 2856 3284 3455 4150 4865 4525 4600 4800 4900 4850 4850 4750
Silver ($US/troy oz.) 31.86 33.65 39.51 55.21 83.71 74.00 76.00 78.00 78.50 77.00 75.00 75.00
Copper (cents/lb) 423 432 444 505 582 605 600 590 575 580 590 580
Nickel ($US/lb) 7.06 6.88 6.81 6.76 7.87 8.25 8.25 8.25 8.05 7.75 7.75 7.75
Aluminum (cents/lb) 119 111 119 128 145 163 165 162 155 155 150 150
Wheat ($US/bu) 5.65 5.34 4.88 5.13 5.50 6.05 6.15 6.30 6.50 6.65 6.60 6.55


Canadian Economic Outlook

[Period-Over-Period Annualized Per Cent Change Unless Otherwise Indicated]

F: Forecast by TD Economics, June 2026. Note: Home price measure shown is the CREA Composite Sale Price. * Intellectual Property Products. ** CPIX: CPI excluding the 8 most volatile components. *** BoC Inflation: Simple average of CPI-trim and CPI-median.
Source: Statistics Canada, Bank of Canada, Canada Mortgage and Housing Corporation, Haver Analytics, TD Economics.
Economic Indicators 2025 2026 2027 Annual Average 4th Qtr/4th Qtr
Q1 Q2 Q3 Q4 Q1 Q2F Q3F Q4F Q1F Q2F Q3F Q4F 25 26F 27F 25 26F 27F
 Real GDP 2.9 -1.0 1.9 -1.0 -0.1 1.9 1.9 1.7 1.7 1.7 1.8 1.8 1.9 0.7 1.8 0.7 1.3 1.8
 Consumer Expenditure 1.2 4.4 -0.8 2.9 1.5 0.5 1.4 1.5 1.5 1.6 1.6 1.7 2.4 1.4 1.5 1.9 1.2 1.6
Durable Goods             -4.6 1.4 -4.2 -2.5 -6.4 1.5 1.5 1.5 1.4 1.4 1.4 1.5 0.7 -2.0 1.4 -2.5 -0.5 1.4
 Business Investment 0.0 -1.0 -5.0 3.8 0.4 1.5 1.7 1.7 2.5 2.7 2.6 2.4 0.2 0.7 2.2 -0.6 1.3 2.6
Non-Res. Structures -3.2 10.2 -0.9 -1.1 -10.2 -3.0 1.7 1.8 2.7 3.0 2.8 2.6 1.7 -2.6 2.1 1.1 -2.6 2.8
Equipment & IPP* 3.1 -10.7 -9.1 9.0 11.7 5.6 1.7 1.7 2.2 2.5 2.4 2.3 -1.2 3.9 2.3 -2.3 5.1 2.4
 Residential Investment -10.2 0.2 4.4 -9.4 -7.9 -2.0 2.4 0.3 0.5 0.7 0.8 1.0 0.5 -3.4 0.6 -3.9 -1.9 0.8
 Govt. Expenditure 1.5 5.0 0.4 5.6 -2.4 1.2 2.4 2.4 2.4 2.3 2.2 2.2 3.2 1.4 2.3 3.1 0.9 2.3
 Final Domestic Demand 0.2 3.6 -0.5 2.7 -0.4 0.7 1.8 1.7 1.8 1.9 1.9 1.9 2.2 1.0 1.7 1.5 0.9 1.8
 Exports                   4.5 -23.4 4.1 6.7 -0.5 13.6 1.3 1.8 2.1 2.6 2.6 2.6 -1.4 2.6 2.8 -2.9 3.9 2.5
 Imports                   3.6 1.2 -10.9 2.0 12.0 6.2 2.0 2.9 2.9 3.3 2.9 2.8 -0.3 3.4 3.1 -1.2 5.7 3.0
 Change in Non-Farm                                    
 Inventories (2012, $Bn) -2.0 18.6 2.8 -17.0 5.0 4.5 6.5 8.5 9.5 10.0 10.5 11.0 0.6 6.1 10.2 -- -- --
 Final Sales -1.8 -0.3 1.7 6.8 -3.9 1.2 1.5 1.4 1.7 1.8 1.8 1.8 2.2 0.9 1.6 1.6 0.0 1.8
 International Current                                    
 Account Balance ($Bn)  -11.7 -87.2 -20.2 -4.0 -28.7 30.6 14.4 -10.9 -12.4 -13.9 -14.5 -15.0 -30.8 1.3 -13.9 -- -- --
% of GDP  -0.4 -2.7 -0.6 -0.1 -0.9 0.9 0.4 -0.3 -0.4 -0.4 -0.4 -0.4 -0.9 0.0 -0.4 -- -- --
 Pre-Tax Corp. Profits 6.4 -14.3 18.2 10.7 9.6 21.0 -15.1 -3.4 0.4 1.3 1.7 1.8 6.2 6.9 -0.9 4.5 2.1 1.3
% of GDP  14.3 13.8 14.2 14.5 14.6 15.0 14.3 14.2 14.1 14.0 13.9 13.9 14.2 14.5 14.0 -- -- --
 GDP Deflator (y/y) 3.0 2.0 2.4 2.7 3.0 5.1 4.1 2.7 1.9 0.6 1.1 2.0 2.5 3.7 1.4 2.7 2.7 2.0
 Nominal GDP  6.1 -1.6 6.3 3.0 4.6 9.8 1.9 0.0 3.4 3.9 3.9 3.8 4.4 4.4 3.1 3.4 4.0 3.8
 Labour Force 2.0 1.3 0.5 1.3 -1.5 0.6 -0.1 0.0 0.1 0.2 0.4 0.5 1.9 0.1 0.2 1.3 -0.2 0.3
 Employment  2.3 0.3 0.0 2.4 -1.0 0.3 0.6 0.6 0.6 0.6 0.8 0.9 1.4 0.4 0.6 1.3 0.1 0.7
 Change in Empl. ('000s)  118 15 1 127 -52 15 31 32 30 33 44 49 296 82 132 261 25 156
 Unemployment Rate (%)  6.7 6.9 7.0 6.7 6.6 6.7 6.6 6.4 6.3 6.2 6.1 6.0 6.8 6.6 6.2 -- -- --
 Personal Disp. Income  2.6 -0.2 3.3 2.5 2.4 8.2 1.1 3.2 3.4 3.4 3.6 3.7 3.9 3.3 3.4 2.0 3.7 3.5
 Pers. Savings Rate (%)  5.3 4.3 4.4 3.7 3.5 4.3 3.8 4.0 4.0 3.9 3.9 3.9 4.4 3.9 3.9 -- -- --
 Cons. Price Index (y/y) 2.3 1.8 2.0 2.2 2.1 3.0 2.9 2.4 2.3 1.8 1.8 2.1 2.1 2.6 2.0 2.2 2.4 2.1
 CPIX (y/y)** 2.3 2.6 2.7 2.8 2.5 2.1 2.4 2.2 2.2 2.3 2.0 2.0 2.6 2.3 2.1 2.8 2.2 2.0
 BoC Inflation (y/y)*** 2.8 3.1 3.1 2.8 2.4 2.2 2.4 2.4 2.5 2.3 2.0 2.0 2.9 2.3 2.2 2.8 2.4 2.0
 Housing Starts ('000s) 224 282 273 255 242 263 245 235 227 223 226 229 258 246 226 -- -- --
 Home Prices (y/y) -1.4 -2.4 0.4 -2.0 -1.4 1.5 -0.9 -0.3 3.6 1.9 2.6 3.4 -1.4 -0.3 2.9 -2.0 -0.3 3.4
 Real GDP / Worker (y/y) 1.2 0.6 0.5 -0.5 -0.5 0.2 0.1 1.2 1.3 1.1 1.1 1.0 0.4 0.3 1.1 -0.5 1.2 1.0

 

U.S. Economic Outlook

[Period-Over-Period Annualized Per Cent Change Unless Otherwise Indicated]

F: Forecast by TD Economics, June 2026. * Intellectual Property Products. ** Non-farm business sector.
Source: Bureau of Labor Statistics, Bureau of Economic Analysis, Census Bureau, TD Economics.
Economic Indicators 2025 2026 2027 Annual Average 4th Qtr/4th Qtr
Q1 Q2 Q3 Q4 Q1 Q2F Q3F Q4F Q1F Q2F Q3F Q4F 25 26F 27F 25 26F 27F
 Real GDP -0.6 3.8 4.4 0.5 1.6 2.6 2.2 2.3 2.0 2.2 2.2 2.2 2.1 2.2 2.2 2.0 2.2 2.2
 Consumer Expenditure 0.6 2.5 3.5 1.9 1.4 2.2 1.8 2.1 2.0 2.0 2.1 2.1 2.6 2.1 2.0 2.1 1.9 2.1
Durable Goods             -3.4 2.3 1.5 0.1 0.4 4.7 2.2 3.5 3.2 3.2 3.2 3.2 3.6 1.8 3.2 0.1 2.7 3.2
 Business Investment 9.5 7.3 3.2 2.4 10.1 9.0 6.6 5.8 3.9 3.9 3.9 4.0 4.1 6.7 4.9 5.6 7.9 3.9
Non-Res. Structures -3.1 -7.5 -5.0 -6.6 -5.4 -3.0 -1.0 0.0 1.0 1.0 1.0 1.0 -5.3 -4.4 0.3 -5.5 -2.4 1.0
Equipment & IPP* 13.4 11.8 5.4 4.8 14.3 12.2 8.5 7.2 4.6 4.6 4.6 4.6 6.9 9.6 6.0 8.8 10.5 4.6
 Residential Investment -1.0 -5.1 -7.1 -1.7 -6.3 1.1 -1.8 3.6 6.9 6.4 5.4 4.4 -2.2 -3.0 4.3 -3.8 -0.9 5.8
 Govt. Expenditure -1.0 -0.1 2.2 -5.6 4.4 1.1 0.8 0.9 1.0 0.9 0.9 0.8 1.1 0.6 0.9 -1.2 1.8 0.9
 Final Domestic Demand 1.4 2.4 2.8 0.6 2.7 2.9 2.2 2.4 2.3 2.3 2.2 2.2 2.4 2.2 2.3 1.8 2.6 2.3
 Exports                   0.2 -1.8 9.6 -3.2 13.1 12.4 4.0 2.8 2.7 2.7 2.7 2.7 1.6 6.6 3.4 1.1 8.0 2.7
 Imports                   38.0 -29.3 -4.4 -1.0 21.1 15.5 6.9 5.3 5.1 2.9 2.5 2.5 2.7 5.9 5.0 -1.9 12.0 3.2
 Change in Private Inventories 172.0 -18.3 -23.9 -15.6 -25.7 -3.0 26.7 36.7 41.7 41.7 41.7 41.7 28.6 8.7 41.7 -- -- --
 Final Sales -3.2 7.5 4.5 0.3 1.5 2.2 1.7 2.1 1.9 2.2 2.3 2.2 2.2 2.2 2.1 2.2 1.9 2.2
 Pre-tax Corporate Profits                                    
 Including IVA&CCA -4.7 0.7 19.1 26.3 3.8 -4.2 3.6 5.7 0.9 4.6 5.5 7.7 7.3 7.7 3.5 9.6 2.2 4.7
% of GDP  13.1 12.9 13.2 13.9 13.8 13.4 13.3 13.4 13.3 13.3 13.3 13.4 13.3 13.5 13.3 -- -- --
 GDP Deflator (y/y) 2.6 2.5 3.0 3.3 3.3 4.1 3.8 3.5 3.2 2.4 2.2 2.2 2.8 3.7 2.5 3.3 3.5 2.2
 Nominal GDP  2.9 6.0 8.3 4.2 5.2 8.2 5.1 4.7 4.1 4.6 4.3 4.5 5.0 6.0 4.7 5.4 5.8 4.4
 Labor Force 5.4 0.1 0.4 1.6 -2.6 -0.7 0.4 0.3 0.2 0.2 0.2 0.2 1.6 -0.4 0.2 1.8 -0.7 0.2
 Non-Farm Employment  0.5 0.4 0.1 -0.2 0.3 1.0 0.6 0.5 0.5 0.4 0.4 0.4 0.5 0.4 0.5 0.2 0.6 0.4
 Change in Non-Farm Empl. ('000 205 169 34 -91 129 411 230 180 180 170 160 150 745 588 778 317 950 660
 Unemployment Rate (%)  4.1 4.2 4.3 4.5 4.3 4.3 4.3 4.3 4.2 4.1 4.0 4.0 4.3 4.3 4.1 -- -- --
 Personal Disp. Income  5.8 4.0 3.8 2.0 5.4 4.1 3.4 4.1 5.4 5.5 5.7 5.6 4.3 3.9 4.9 3.9 4.3 5.6
 Pers. Savings Rate (%)  5.2 5.0 4.4 3.8 3.7 2.9 2.6 2.7 3.0 3.4 3.8 4.2 4.6 3.0 3.6 -- -- --
 Cons. Price Index (y/y) 2.7 2.5 2.9 2.7 2.7 4.1 3.9 3.5 3.0 1.6 1.5 1.8 2.7 3.5 2.0 2.7 3.5 1.8
 Core CPI (y/y) 3.1 2.8 3.1 2.7 2.5 2.9 2.8 3.0 2.9 2.5 2.3 2.3 2.9 2.8 2.5 2.7 3.0 2.3
 Core PCE Price Index (y/y) 2.8 2.7 2.9 2.9 3.1 3.4 3.4 3.3 2.8 2.4 2.2 2.1 2.8 3.3 2.3 2.9 3.3 2.1
 Housing Starts (mns)  1.40 1.36 1.35 1.32 1.41 1.30 1.35 1.40 1.45 1.48 1.50 1.52 1.36 1.37 1.49 -- -- --
 Real Output per Hour** (y/y) 2.0 2.1 2.5 2.5 2.8 2.4 1.6 1.9 2.2 1.9 1.9 1.7 2.3 2.2 1.9 2.5 1.9 1.7

 

Economic Indicators: G7 & Europe

F: Forecast by TD Economics, June 2026. * Share of 2024 world gross domestic product (GDP) at PPP.
Source: National Statistics Agencies, TD Economics.
  2025 2026F 2027F
Real GDP (Annual Per Cent Change)
G7 1.5 1.5 1.7
  U.S. 2.1 2.2 2.2
  Japan 1.1 0.6 0.7
  Euro Area 1.5 0.4 1.2
  Germany 0.3 0.6 1.3
  France 0.9 0.7 1.2
  Italy 0.7 0.9 0.9
  United Kingdom 1.4 1.0 1.1
  Canada 1.9 0.7 1.8
Consumer Price Index (Annual Per Cent Change)
G7 2.3 2.3 2.2
  U.S. 2.7 3.5 2.0
  Japan 3.2 1.8 2.0
  Euro Area 2.1 3.0 2.1
  Germany 2.3 2.9 2.5
  France 0.9 2.6 2.1
  Italy 1.6 2.8 2.4
  United Kingdom 3.4 3.3 2.7
  Canada 2.1 2.6 2.0
Unemployment Rate (Per Cent Annual Averages)
  U.S. 4.3 4.3 4.1
  Japan 2.5 2.6 2.4
  Euro Area 6.3 6.3 6.2
  Germany 6.3 6.3 5.6
  France 7.7 8.0 7.4
  Italy 6.1 5.4 5.8
  United Kingdom 4.9 5.2 5.4
  Canada 6.8 6.6 6.2
 

Global Economic Outlook

[Annual Per Cent Change Unless Otherwise Indicated]

F: Forecast by TD Economics, June 2026. * Share of 2024 world gross domestic product (GDP) at PPP. Forecast for India refers to fiscal year.
Source: International Monetary Fund, TD Economics.
2024 Share* Forecast
Real GDP (%) 2025 2026F 2027F
World 100.0 3.5 3.0 3.0
North America 17.9 1.9 1.9 2.1
   United States 14.8 2.1 2.2 2.2
   Canada 1.3 1.9 0.7 1.8
   Mexico 1.7 0.7 0.5 1.9
European Union (EU-27) 14.2 1.6 0.7 1.5
   Euro Area (EU-20) 12.2 1.5 0.4 1.2
        Germany 3.0 0.3 0.6 1.3
        France  2.2 0.9 0.7 1.2
        Italy 1.8 0.7 0.9 0.9
   Other EU Members 3.8 3.1 3.0 2.2
Asia 46.9 4.8 4.5 3.9
   Japan 3.3 1.1 0.6 0.7
   Asian NIC's 3.5 3.9 4.2 1.9
        Hong Kong 0.3 3.6 3.7 1.4
        Korea 1.6 1.1 3.0 2.1
        Singapore  0.5 5.0 3.5 2.1
        Taiwan 0.9 8.8 7.6 2.0
   Russia 3.5 1.1 0.7 0.9
   Australia & New Zealand 1.2 1.8 2.0 2.1
   Emerging Asia 35.7 5.7 5.2 4.8
        ASEAN-5 5.2 5.3 4.5 4.8
        China 19.3 5.0 4.5 4.2
        India** 8.2 7.8 6.5 6.0
Central/South America 5.3 2.9 2.2 2.3
   Brazil 2.4 2.6 2.1 2.1
Other Emerging Markets 12.8 3.6 1.9 2.8
Other Advanced 3.2 1.8 1.6 2.2
   United Kingdom 2.2 1.4 1.0 1.1

 

Long-Term U.S. Economic Outlook

[Period-Over-Period Annualized Per Cent Change Unless Otherwise Indicated]

F: Forecast by TD Economics, June 2026.
* Intellectual property products. ** Non-farm business sector.
Source: Bureau of Labor Statistics, Bureau of Economic Analysis, Census Bureau, TD Economics.
Economic Indicator Annual Average Fourth Quarter / Fourth Quarter
25 26F 27F 28F 29F 30F 31F 25 26F 27F 28F 29F 30F 31F
 Real GDP 2.1 2.2 2.2 2.0 2.0 2.0 2.0 2.0 2.2 2.2 1.9 2.0 2.0 2.0
 Consumer Expenditure 2.6 2.1 2.0 2.0 2.1 2.2 2.2 2.1 1.9 2.1 2.0 2.2 2.2 2.2
Durable Goods             3.6 1.8 3.2 3.4 3.5 3.5 3.5 0.1 2.7 3.2 3.5 3.5 3.5 3.5
 Business Investment 4.1 6.7 4.9 3.2 2.7 2.7 2.7 5.6 7.9 3.9 2.7 2.7 2.7 2.7
Non-Res. Structures -5.3 -4.4 0.3 1.6 2.0 2.0 2.0 -5.5 -2.4 1.0 2.0 2.0 2.0 2.0
Equipment & IPP* 6.9 9.6 6.0 3.5 2.9 2.9 2.9 8.8 10.5 4.6 2.9 2.9 2.9 2.9
 Residential Investment -2.2 -3.0 4.3 3.9 2.8 2.2 1.6 -3.8 -0.9 5.8 3.0 2.8 1.8 1.6
 Govt. Expenditure 1.1 0.6 0.9 0.6 0.3 0.2 0.0 -1.2 1.8 0.9 0.4 0.3 0.1 0.1
 Final Domestic Demand 2.4 2.2 2.3 2.0 1.9 1.9 1.9 1.8 2.6 2.3 1.9 2.0 1.9 1.9
 Exports                   1.6 6.6 3.4 2.9 3.0 3.0 3.0 1.1 8.0 2.7 3.0 3.0 3.0 3.0
 Imports                   2.7 5.9 5.0 2.6 2.5 2.5 2.5 -1.9 12.0 3.2 2.6 2.5 2.5 2.5
 Change in Private                            
 Inventories 28.6 8.7 41.7 41.7 41.7 41.7 41.7 --- --- --- --- --- --- ---
 Final Sales 2.2 2.2 2.1 2.0 2.0 2.0 2.0 2.2 1.9 2.2 1.9 2.0 2.0 2.0
 Pre-Tax Corporate Profits                            
 Including IVA&CCA 7.3 7.7 3.5 6.2 4.8 3.2 2.8 9.6 2.2 4.7 5.5 4.5 2.9 3.0
% of GDP  13.3 13.5 13.3 13.6 13.7 13.5 13.4 --- --- --- --- --- --- ---
 GDP Deflator (y/y) 2.8 3.7 2.5 2.2 2.0 2.1 2.2 3.3 3.5 2.2 2.1 2.0 2.1 2.2
 Nominal GDP  5.0 6.0 4.7 4.2 4.0 4.1 4.2 5.4 5.8 4.4 4.1 4.1 4.1 4.2
 Labor Force 1.6 -0.4 0.2 0.3 0.4 0.4 0.4 1.8 -0.7 0.2 0.4 0.4 0.4 0.4
 Employment  0.5 0.4 0.5 0.3 0.2 0.2 0.2 0.2 0.6 0.4 0.3 0.2 0.2 0.2
 Change in Empl. ('000s)  745 588 778 520 400 399 400 317 950 660 435 400 399 400
 Unemployment Rate (%)  4.3 4.3 4.1 4.0 4.0 4.0 4.0 --- --- --- --- --- --- ---
 Personal Disp. Income  4.3 3.9 4.9 5.8 5.5 5.1 4.8 3.9 4.3 5.6 5.9 5.2 5.0 4.7
 Pers. Savings Rate (%)  4.6 3.0 3.6 5.3 6.5 7.2 7.6 --- --- --- --- --- --- ---
 Cons. Price Index (y/y) 2.7 3.5 2.0 2.1 2.2 2.2 2.2 2.7 3.5 1.8 2.2 2.2 2.2 2.2
 Core CPI (y/y) 2.9 2.8 2.5 2.2 2.2 2.2 2.2 2.7 3.0 2.3 2.2 2.2 2.2 2.2
 Core PCE Price Index (y/y) 2.8 3.3 2.3 2.0 2.0 2.0 2.0 2.9 3.3 2.1 2.0 2.0 2.0 2.0
 Housing Starts (mns)  1.4 1.4 1.5 1.6 1.6 1.6 1.6 --- --- --- --- --- --- ---
 Real Output per Hour** (y/y) 2.3 2.2 1.9 1.7 1.6 1.5 1.5 2.5 1.9 1.7 1.6 1.6 1.5 1.5

Long-Term Canadian Economic Outlook

[Period-Over-Period Annualized Per Cent Change Unless Otherwise Indicated]

F: Forecast by TD Economics, June 2026.
* Intellectual Property Products. ** CPIX: CPI ex. 8 most volatile components. *** BoC Inflation: Avg. of CPI-trim and CPI-median.
Note: Home price measure shown is the CREA Composite Sale Price.
Source: Statistics Canada, Bank of Canada, CMHC, CREA, TD Economics.
            Economic Indicator                 Annual Average 4th Quarter / 4th Quarter
25 26F 27F 28F 29F 30F 31F 25 26F 27F 28F 29F 30F 31F
  Real GDP 1.9 0.7 1.8 1.8 1.8 1.7 1.7 0.7 1.3 1.8 1.8 1.8 1.7 1.7
Consumer Expenditure 2.4 1.4 1.5 1.7 1.7 1.7 1.7 1.9 1.2 1.6 1.7 1.7 1.7 1.7
Durable Goods             0.7 -2.0 1.4 1.5 1.6 1.7 1.7 -2.5 -0.5 1.4 1.6 1.6 1.7 1.7
Business Investment 0.2 0.7 2.2 2.4 2.0 1.9 1.8 -0.6 1.3 2.6 2.2 2.0 1.8 1.8
Non-Res. Structures 1.7 -2.6 2.1 2.5 2.1 1.9 1.8 1.1 -2.6 2.8 2.3 2.0 1.9 1.8
Equipment & IPP* -1.2 3.9 2.3 2.2 2.0 1.8 1.8 -2.3 5.1 2.4 2.1 1.9 1.8 1.8
Residential Investment 0.5 -3.4 0.6 1.1 1.4 1.5 1.6 -3.9 -1.9 0.8 1.2 1.4 1.6 1.6
Govt. Expenditure 3.2 1.4 2.3 2.1 2.0 1.9 1.8 3.1 0.9 2.3 2.0 1.9 1.8 1.8
    Final Domestic Demand 2.2 1.0 1.7 1.8 1.8 1.8 1.7 1.5 0.9 1.8 1.8 1.8 1.7 1.7
Exports                   -1.4 2.6 2.8 2.6 2.5 2.5 2.5 -2.9 3.9 2.5 2.5 2.5 2.5 2.5
Imports                   -0.3 3.4 3.1 2.8 2.7 2.6 2.5 -1.2 5.7 3.0 2.7 2.6 2.6 2.5
Change in Non-Farm                            
Inventories (2012 $Bn) 0.6 6.1 10.2 12.2 14.1 14.8 15.2 -- -- -- -- -- -- --
   Final Sales 2.2 0.9 1.6 1.8 1.7 1.7 1.7 1.6 0.0 1.8 1.7 1.7 1.7 1.7
International Current                            
Account Balance ($Bn)  -30.8 1.3 -13.9 -15.8 -16.5 -16.6 -16.5 -- -- -- -- -- -- --
% of GDP  -0.9 0.0 -0.4 -0.4 -0.4 -0.4 -0.4 -- -- -- -- -- -- --
Pre-Tax Corp. Profits 6.2 6.9 -0.9 2.1 2.8 2.9 3.0 4.5 2.1 1.3 2.4 2.8 2.9 3.1
% of GDP  14.2 14.5 14.0 13.7 13.6 13.5 13.4 -- -- -- -- -- -- --
  GDP Deflator (y/y) 2.5 3.7 1.4 2.0 2.0 2.0 2.0 2.7 2.7 2.0 1.9 2.0 2.0 2.0
  Nominal GDP  4.4 4.4 3.1 3.8 3.8 3.8 3.7 3.4 4.0 3.8 3.8 3.8 3.7 3.7
  Labour Force 1.9 0.1 0.2 0.4 0.4 0.5 0.4 1.3 -0.2 0.3 0.4 0.5 0.4 0.4
  Employment  1.4 0.4 0.6 0.7 0.5 0.5 0.5 1.3 0.1 0.7 0.6 0.5 0.5 0.4
  Change in Empl. ('000s)  296 82 132 146 99 97 97 261 25 156 117 97 97 97
  Unemployment Rate (%)  6.8 6.6 6.2 5.9 5.9 5.9 5.9 -- -- -- -- -- -- --
  Personal Disp. Income  3.9 3.3 3.4 3.4 3.4 3.5 3.5 2.0 3.7 3.5 3.3 3.5 3.5 3.5
  Pers. Savings Rate (%)  4.4 3.9 3.9 3.7 3.4 3.2 3.0 -- -- -- -- -- -- --
  Cons. Price Index (y/y) 2.1 2.6 2.0 2.0 2.0 2.0 2.0 2.2 2.4 2.1 2.0 2.0 2.0 2.0
  CPIX (y/y) ** 2.6 2.3 2.1 2.0 2.0 2.0 2.0 2.8 2.2 2.0 2.0 2.0 2.0 2.0
  BoC Inflation (y/y) *** 2.9 2.3 2.2 2.0 2.0 2.0 2.0 2.8 2.4 2.0 2.0 2.0 2.0 2.0
  Housing Starts ('000s) 258.4 246.4 226.2 232.1 234.4 233.5 233.0 -- -- -- -- -- -- --
  Home Prices (y/y) -1.4 -0.3 2.9 4.0 3.8 3.4 3.3 -2.0 -0.3 3.4 4.1 3.6 3.3 3.2
  Real GDP / Worker (y/y) 0.4 0.3 1.1 1.1 1.3 1.3 1.3 -0.5 1.2 1.0 1.2 1.3 1.3 1.3

 

Long-Term Interest Rates

[Period-Over-Period Annualized Per Cent Change Unless Otherwise Indicated]

F: Forecast by TD Economics, June 2026.
*Upper bound of target range.
Note: Annual averages are the average of the four quarterly end-of-period forecasts.
Source: Bank of Canada, Bloomberg, Statistics Canada, TD Economics.
Interest Rates Annual Average End of Period
25 26F 27F 28F 29F 30F 31F 25 26F 27F 28F 29F 30F 31F
U.S. FIXED INCOME                            
   Fed Funds Target Rate (%)* 4.37 3.75 3.38 3.25 3.25 3.25 3.25 3.75 3.75 3.25 3.25 3.25 3.25 3.25
   3-mth T-Bill Rate (%) 4.07 3.62 3.24 3.15 3.15 3.15 3.15 3.57 3.55 3.15 3.15 3.15 3.15 3.15
   2-yr Govt. Bond Yield (%) 3.81 3.78 3.38 3.35 3.35 3.35 3.35 3.47 3.60 3.35 3.35 3.35 3.35 3.35
   5-yr Govt. Bond Yield (%) 3.93 3.92 3.71 3.70 3.70 3.70 3.70 3.73 3.75 3.70 3.70 3.70 3.70 3.70
   10-yr Govt. Bond Yield (%) 4.29 4.29 4.11 4.10 4.10 4.10 4.10 4.18 4.15 4.10 4.10 4.10 4.10 4.10
  10-yr-2-yr Govt. Spread (%) 0.48 0.52 0.73 0.75 0.75 0.75 0.75 0.71 0.55 0.75 0.75 0.75 0.75 0.75
CANADIAN FIXED INCOME                            
   Overnight Target Rate (%) 2.71 2.25 2.25 2.25 2.25 2.25 2.25 2.25 2.25 2.25 2.25 2.25 2.25 2.25
   3-mth T-Bill Rate (%) 2.58 2.25 2.25 2.25 2.25 2.25 2.25 2.15 2.25 2.25 2.25 2.25 2.25 2.25
   2-yr Govt. Bond Yield (%) 2.53 2.74 2.60 2.60 2.60 2.60 2.60 2.58 2.65 2.60 2.60 2.60 2.60 2.60
   5-yr Govt. Bond Yield (%) 2.84 3.03 2.91 2.90 2.90 2.90 2.90 2.96 2.95 2.90 2.90 2.90 2.90 2.90
  10-yr Govt. Bond Yield (%) 3.24 3.40 3.26 3.25 3.16 3.15 3.15 3.42 3.30 3.25 3.25 3.15 3.15 3.15
  10-yr-2-yr Govt. Spread (%) 0.71 0.66 0.66 0.65 0.56 0.55 0.55 0.84 0.65 0.65 0.65 0.55 0.55 0.55

 

Home Sales and Price Outlook

[Annual Average Growth, %]

Source: CREA, CMHC, TD Economics. Forecasts by TD Economics as of March 2026.
Provinces Home Sales Home Prices
2025 2026F 2027F 2025 2026F 2027F
 National -2.4 -1.8 9.6 -1.4 -0.3 2.7
Newfoundland & Labrador 8.0 3.1 2.4 8.3 5.5 3.3
Prince Edward Island 5.9 -1.0 5.3 2.5 3.9 3.5
Nova Scotia -0.1 1.0 8.5 5.5 4.7 3.9
New Brunswick 4.1 0.4 4.6 5.6 2.9 3.7
Québec 7.7 -0.5 3.0 8.2 6.0 4.2
Ontario -5.6 -3.2 12.3 -4.1 -4.0 0.3
Manitoba 5.7 -5.8 6.8 3.6 4.9 4.1
Saskatchewan 0.8 -0.1 10.1 8.6 6.4 5.1
Alberta -7.8 -2.1 11.5 3.9 4.0 4.3
British Columbia -5.7 -0.2 13.0 -2.7 -1.2 1.9

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