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Interest Rate Outlook

F: Forecast by TD Economics, May 2025; Forecasts are end-of-period.
Source: Bloomberg, Bank of Canada, Federal Reserve.
Interest Rates Spot Rate 2024 2025 2026
May-08 Q1 Q2 Q3 Q4 Q1 Q2F Q3F Q4F Q1F Q2F Q3F Q4F
CANADA                          
Overnight Target Rate  2.75 5.00 4.75 4.25 3.25 2.75 2.50 2.25 2.25 2.25 2.25 2.25 2.25
3-mth T-Bill Rate  2.64 4.99 4.64 3.96 3.16 2.62 2.38 2.25 2.25 2.25 2.25 2.25 2.25
2-yr Govt. Bond Yield  2.55 4.17 3.99 2.91 2.93 2.46 2.61 2.40 2.35 2.35 2.35 2.35 2.35
5-yr Govt. Bond Yield  2.76 3.51 3.51 2.73 2.96 2.61 2.84 2.85 2.80 2.75 2.75 2.75 2.75
10-yr Govt. Bond Yield  3.15 3.45 3.50 2.95 3.23 2.97 3.23 3.10 3.05 3.00 3.00 3.00 3.00
30-yr Govt. Bond Yield  3.47 3.37 3.37 3.14 3.33 3.23 3.45 3.40 3.35 3.30 3.30 3.30 3.30
10-yr-2-yr Govt Spread 0.60 -0.72 -0.49 0.04 0.30 0.51 0.62 0.70 0.70 0.65 0.65 0.65 0.65
U.S.                           
Fed Funds Target Rate  4.50 5.50 5.50 5.00 4.50 4.50 4.50 4.00 3.75 3.75 3.25 3.00 3.00
3-mth T-Bill Rate  4.22 5.23 5.22 4.52 4.23 4.21 4.31 3.80 3.65 3.40 3.00 2.90 2.90
2-yr Govt. Bond Yield  3.84 4.59 4.71 3.66 4.25 3.89 3.80 3.55 3.30 3.05 3.00 3.00 3.00
5-yr Govt. Bond Yield  3.93 4.21 4.33 3.58 4.38 3.96 3.91 3.80 3.60 3.55 3.45 3.45 3.45
10-yr Govt. Bond Yield  4.31 4.20 4.36 3.81 4.58 4.23 4.32 4.20 4.00 3.80 3.75 3.75 3.75
30-yr Govt. Bond Yield  4.80 4.34 4.51 4.14 4.78 4.59 4.82 4.60 4.38 4.15 4.05 4.05 4.05
10-yr-2-yr Govt Spread 0.48 -0.39 -0.35 0.15 0.33 0.34 0.52 0.65 0.70 0.75 0.75 0.75 0.75
CANADA - U.S SPREADS                          
Can - U.S. T-Bill Spread -1.58 -0.24 -0.58 -0.56 -1.07 -1.59 -1.93 -1.55 -1.40 -1.15 -0.75 -0.65 -0.65
Can - U.S. 10-Year Bond Spread -1.16 -0.75 -0.86 -0.86 -1.35 -1.26 -1.09 -1.10 -0.95 -0.80 -0.75 -0.75 -0.75

 

Foreign Exchange Outlook

F: Forecast by TD Economics, May 2025; Forecasts are end-of-period.
Source: Federal Reserve, Bloomberg.
Currency Exchange
Rate		 Spot Price 2024 2025 2026
May-08 Q1 Q2 Q3 Q4 Q1 Q2F Q3F Q4F Q1F Q2F Q3F Q4F
Exchange rate to U.S. dollar                          
 Chinese Yuan CNY per USD 7.24 7.22 7.27 7.02 7.30 7.26 7.40 7.35 7.30 7.25 7.20 7.15 7.10
 Japanese yen JPY per USD 145 151 161 143 157 150 148 147 145 145 144 143 143
 Euro USD per EUR 1.13 1.08 1.07 1.12 1.04 1.08 1.10 1.12 1.14 1.17 1.19 1.20 1.20
 U.K. pound USD per GBP 1.33 1.26 1.26 1.34 1.25 1.29 1.30 1.33 1.35 1.38 1.40 1.40 1.40
 Canadian dollar CAD per USD 1.39 1.35 1.37 1.35 1.44 1.44 1.39 1.38 1.37 1.36 1.35 1.34 1.33
 Australian dollar USD per AUD 0.64 0.65 0.67 0.69 0.62 0.62 0.62 0.63 0.65 0.66 0.67 0.68 0.68
 NZ dollar USD per NZD 0.59 0.60 0.61 0.64 0.56 0.57 0.56 0.58 0.59 0.60 0.61 0.62 0.62
Exchange rate to Euro                            
 U.S. dollar USD per EUR 1.13 1.08 1.07 1.12 1.04 1.08 1.10 1.12 1.14 1.17 1.19 1.20 1.20
 Japanese yen JPY per EUR 164 163 172 160 163 162 163 165 166 169 171 172 171
 U.K. pound GBP per EUR 0.85 0.85 0.85 0.83 0.83 0.84 0.85 0.85 0.85 0.85 0.85 0.86 0.86
 Canadian dollar CAD per EUR 1.57 1.46 1.47 1.51 1.49 1.55 1.53 1.55 1.57 1.59 1.61 1.61 1.60
 Australian dollar AUD per EUR 1.76 1.65 1.60 1.61 1.67 1.73 1.77 1.77 1.77 1.77 1.77 1.77 1.77
 NZ dollar NZD per EUR 1.91 1.80 1.76 1.75 1.85 1.91 1.95 1.95 1.95 1.95 1.95 1.95 1.95
Exchange rate to Japanese yen                          
 U.S. dollar JPY per USD 145 151 161 143 157 150 148 147 145 145 144 143 143
 Euro JPY per EUR 164 163 172 160 163 162 163 165 166 169 171 172 171
 U.K. pound JPY per GBP 193 191 203 192 197 193 193 195 197 200 202 201 200
 Canadian dollar JPY per CAD 104.2 111.7 117.6 106.0 109.3 104.2 106.8 106.5 106.2 106.4 106.7 106.9 107.2
 Australian dollar JPY per AUD 92.9 98.7 107.4 99.3 97.3 93.5 92.0 92.9 93.8 95.2 96.6 96.9 96.4
 NZ dollar JPY per NZD 85.8 90.5 98.1 91.2 88.1 84.9 83.6 84.4 85.2 86.5 87.8 88.1 87.6
Exchange rate to Canadian dollar                          
 U.S. dollar USD per CAD 0.72 0.74 0.73 0.74 0.69 0.70 0.72 0.73 0.73 0.74 0.74 0.75 0.75
 Japanese yen JPY per CAD 104.2 111.7 117.6 106.0 109.3 104.2 106.8 106.5 106.2 106.4 106.7 106.9 107.2
 Euro CAD per EUR 1.57 1.46 1.47 1.51 1.49 1.55 1.53 1.55 1.57 1.59 1.61 1.61 1.60
 U.K. pound CAD per GBP 1.85 1.71 1.73 1.81 1.80 1.85 1.81 1.83 1.85 1.88 1.89 1.88 1.86
 Australian dollar AUD per CAD 1.12 1.13 1.09 1.07 1.12 1.11 1.16 1.15 1.13 1.12 1.10 1.10 1.11
 NZ dollar NZD per CAD 1.21 1.23 1.20 1.16 1.24 1.23 1.28 1.26 1.25 1.23 1.22 1.22 1.22

Global Stock Markets

*Weighted equity index including both developed and emerging markets. Source: Bloomberg, TD Economics.
Major Market Indexes Price 30-Day YTD 52-Week 52-Week
Apr-29 % Chg. % Chg.  High Low
S&P 500 5,530 -0.9 -6.0 6,144 4,983
S&P/TSX Composite 24,782 0.1 0.2 25,808 21,517
DAX 22,362 -0.4 12.3 23,419 17,339
FTSE 100 8,440 -2.5 3.3 8,871 7,679
Nikkei 35,840 -3.4 -10.2 42,224 31,137
MSCI AC World Index* 827 -0.3 -1.7 888 743

 

Commodity Price Outlook

F: Forecast by TD Economics, March 2025. All forecasts are period averages. Source: Bloomberg, TD Economics, USDA (Haver).
Commodity 2024 2025 2026
Q1 Q2 Q3 Q4 Q1F Q2F Q3F Q4F Q1F Q2F Q3F Q4F
Crude Oil (WTI, $US/bbl) 77 81 76 70 72 64 65 67 68 70 72 73
Natural Gas ($US/MMBtu) 2.23 2.07 2.10 2.46 3.90 4.15 4.15 4.25 4.40 4.40 4.40 4.40
Gold ($US/troy oz.) 2072 2336 2475 2661 2830 2875 2850 2825 2800 2800 2750 2750
Silver ($US/troy oz.) 23.37 28.87 29.45 31.30 31.60 32.50 32.00 31.50 31.00 31.00 31.00 31.00
Copper (cents/lb) 383 442 418 417 450 475 475 480 485 485 475 475
Nickel ($US/lb) 7.52 8.35 7.38 7.26 7.10 7.25 7.25 7.20 7.15 7.15 7.15 7.15
Aluminum (cents/lb) 100 114 108 117 120 125 125 120 117 117 115 115
Wheat ($US/bu) 5.87 6.04 5.06 5.47 5.53 5.65 5.70 5.70 5.83 5.87 5.92 5.96

 

Canadian Economic Outlook

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

F: Forecast by TD Economics, March 2025. 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 2024 2025 2026 Annual Average 4th Qtr/4th Qtr
Q1 Q2 Q3 Q4 Q1F Q2F Q3F Q4F Q1F Q2F Q3F Q4F 24 25F 26F 24 25F 26F
 Real GDP 1.8 2.8 2.2 2.6 1.8 -1.0 -0.2 1.7 1.3 1.5 1.6 1.6 1.5 1.3 1.1 2.4 0.6 1.5
 Consumer Expenditure 3.6 1.0 4.2 5.6 2.7 -0.3 -0.1 0.4 0.8 1.0 1.1 1.3 2.4 2.2 0.6 3.6 0.7 1.0
Durable Goods             -0.8 -7.6 12.6 14.2 3.0 -2.0 -1.0 0.0 0.5 0.8 1.0 1.3 3.7 3.8 0.2 4.2 0.0 0.9
 Business Investment 0.9 10.5 -7.0 6.7 -2.0 -4.5 -2.4 2.4 1.3 1.4 1.4 1.5 -1.5 -0.6 0.7 2.6 -1.6 1.4
Non-Res. Structures 3.0 7.5 1.3 2.7 -2.0 -4.0 -3.0 1.3 1.4 1.4 1.5 1.5 -1.8 -0.5 0.5 3.6 -1.9 1.5
Equipment & IPP* -1.1 13.4 -14.4 10.8 -1.9 -5.0 -1.8 3.5 1.3 1.4 1.4 1.4 -1.2 -0.7 0.9 1.6 -1.4 1.4
 Residential Investment -7.5 -8.3 6.4 16.7 -10.0 -2.0 -1.4 3.0 2.8 2.6 2.5 2.4 -1.1 0.1 1.9 1.3 -2.7 2.6
 Govt. Expenditure 6.7 4.4 5.2 2.2 2.0 4.6 5.4 4.1 3.8 3.5 3.2 3.0 3.8 3.6 3.9 4.6 4.0 3.4
 Final Domestic Demand 3.2 2.1 3.3 5.6 1.2 0.4 1.0 1.8 1.8 1.8 1.8 1.8 2.0 2.2 1.6 3.5 1.1 1.8
 Exports                   1.3 -6.9 -0.8 7.4 13.3 -19.9 -7.6 15.8 4.5 2.1 2.2 2.2 0.6 -0.3 2.3 0.1 -0.7 2.7
 Imports                   0.4 -3.1 -1.2 5.4 7.0 -6.2 -1.4 12.2 4.5 2.1 2.3 2.5 0.6 1.7 3.6 0.3 2.7 2.8
 Change in Non-Farm                                    
 Inventories (2012, $Bn) 17.6 29.6 20.9 -2.5 -6.5 13.5 17.5 13.5 11.3 9.8 8.8 8.0 16.4 9.5 9.5 -- -- --
 Final Sales 4.8 0.2 4.7 9.1 2.2 -2.8 0.3 2.4 2.1 2.0 2.0 2.0 2.5 2.5 1.6 4.7 0.5 2.0
 International Current                                    
 Account Balance ($Bn)  -8.9 -19.0 -14.5 -20.0 3.6 -21.2 -32.3 -41.2 -40.7 -40.3 -40.3 -40.7 -15.6 -22.8 -40.5 -- -- --
% of GDP  -0.3 -0.6 -0.5 -0.6 0.1 -0.7 -1.0 -1.3 -1.3 -1.2 -1.2 -1.2 -0.5 -0.7 -1.2 -- -- --
 Pre-Tax Corp. Profits -36.5 11.4 -7.3 33.9 5.9 -8.7 2.8 1.4 3.3 3.4 3.5 3.6 -4.2 5.5 2.2 -3.2 0.2 3.5
% of GDP  12.9 13.0 12.6 13.4 13.4 13.0 13.0 13.0 13.0 13.0 13.0 13.0 13.0 13.1 13.0 -- -- --
 GDP Deflator (y/y) 3.4 3.9 2.7 2.2 3.0 3.1 3.3 2.3 2.3 1.6 1.3 1.9 3.0 2.9 1.8 2.2 2.3 1.9
 Nominal GDP  0.8 7.0 4.3 6.4 3.8 3.4 2.8 1.4 3.3 3.4 3.5 3.5 4.6 4.2 2.9 4.6 2.9 3.4
 Labour Force 2.3 3.8 1.9 2.7 2.3 0.7 0.0 0.1 0.0 0.1 0.1 0.2 3.0 1.7 0.1 2.7 0.8 0.1
 Employment  1.7 2.1 0.8 1.9 2.9 0.3 -1.2 0.0 0.7 0.7 0.7 0.8 1.9 1.2 0.3 1.6 0.5 0.7
 Change in Empl. ('000s)  85 105 40 97 151 14 -65 3 36 36 39 43 382 249 67 327 103 155
 Unemployment Rate (%)  5.9 6.3 6.6 6.7 6.6 6.7 7.0 7.0 6.9 6.7 6.6 6.4 6.4 6.8 6.6 -- -- --
 Personal Disp. Income  4.7 12.4 10.4 4.3 7.5 2.1 1.1 2.5 1.5 2.5 3.1 3.4 7.6 5.4 2.2 7.9 3.3 2.6
 Pers. Savings Rate (%)  4.5 6.3 7.3 6.1 6.7 6.3 5.9 6.1 5.9 5.9 6.0 6.1 6.1 6.2 6.0 -- -- --
 Cons. Price Index (y/y) 2.9 2.8 2.1 1.9 2.1 3.0 3.4 2.6 2.6 1.6 1.3 2.1 2.4 2.8 1.9 1.9 2.6 2.1
 CPIX (y/y)** 2.2 1.8 1.6 1.6 2.1 2.4 2.7 2.5 2.4 2.2 2.0 2.2 1.8 2.4 2.2 1.6 2.5 2.2
 BoC Inflation (y/y)*** 3.2 2.9 2.5 2.6 2.6 2.9 3.0 2.8 2.5 2.3 2.2 2.1 2.8 2.8 2.2 2.6 2.8 2.1
 Housing Starts ('000s) 244 250 238 248 237 230 223 217 212 213 214 218 245 227 214 -- -- --
 Home Prices (y/y) 4.2 -2.7 0.7 5.6 -1.0 -3.1 -3.6 -4.9 1.7 4.6 6.2 6.5 1.9 -3.2 4.8 5.6 -4.9 6.5
 Real GDP / Worker (y/y) -1.4 -0.9 0.2 0.7 0.4 -0.1 -0.2 0.1 0.5 1.0 1.0 0.8 -0.3 0.1 0.8 0.7 0.1 0.8

 

U.S. Economic Outlook

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

F: Forecast by TD Economics, March 2025.
* Intellectual Property Products. ** Non-farm business sector.
Source: Bureau of Labor Statistics, Bureau of Economic Analysis, Census Bureau, TD Economics.
Economic Indicators 2024 2025 2026 Annual Average 4th Qtr/4th Qtr
Q1 Q2 Q3 Q4 Q1F Q2F Q3F Q4F Q1F Q2F Q3F Q4F 24 25F 26F 24 25F 26F
 Real GDP 1.6 3.0 3.1 2.3 1.4 1.4 1.3 2.0 2.1 2.2 2.4 2.4 2.8 1.9 2.0 2.5 1.5 2.3
 Consumer Expenditure 1.9 2.8 3.7 4.2 1.5 1.4 1.5 1.8 2.2 2.1 2.2 2.2 2.8 2.3 2.0 3.1 1.5 2.2
Durable Goods             -1.7 5.4 7.6 12.1 -1.9 0.0 1.3 2.0 3.5 3.3 3.3 3.5 3.3 3.2 2.7 5.7 0.3 3.4
 Business Investment 4.5 3.9 4.0 -3.2 5.0 1.3 1.2 2.9 3.7 3.3 3.2 3.2 3.6 1.9 2.9 2.2 2.6 3.3
Non-Res. Structures 6.2 0.2 -5.0 1.1 0.0 0.0 0.0 1.0 3.0 3.0 3.0 3.0 3.4 -0.4 2.1 0.6 0.2 3.0
Equipment & IPP* 4.8 6.4 6.7 -4.4 6.4 1.7 1.5 3.5 3.8 3.4 3.3 3.3 3.4 2.7 3.2 3.3 3.3 3.4
 Residential Investment 13.7 -2.8 -4.3 5.4 -0.3 -3.2 -2.4 0.1 3.8 7.5 10.3 10.0 4.2 -0.7 3.7 2.8 -1.5 7.9
 Govt. Expenditure 1.8 3.0 5.1 2.9 0.2 -1.0 -0.3 0.3 0.4 0.4 0.4 0.2 3.4 1.2 0.2 3.2 -0.2 0.4
 Final Domestic Demand 2.7 2.8 3.7 3.0 1.7 0.8 1.0 1.6 2.2 2.2 2.3 2.3 3.0 2.0 1.9 3.0 1.3 2.3
 Exports                   1.9 1.0 9.6 -0.5 5.0 -2.6 -0.5 3.6 2.5 2.9 3.0 3.0 3.2 2.0 2.2 2.9 1.3 2.9
 Imports                   6.1 7.6 10.7 -1.2 12.3 -7.0 -2.5 0.0 2.3 2.5 2.5 2.5 5.4 2.8 0.7 5.7 0.5 2.5
 Change in Private Inventories 17.7 71.7 57.9 10.2 54.1 44.4 43.3 41.9 39.5 39.5 39.5 39.5 39.4 45.9 39.5 -- -- --
 Final Sales 2.1 1.9 3.3 3.2 0.6 1.6 1.4 2.1 2.2 2.2 2.4 2.4 2.7 1.9 2.1 2.6 1.4 2.3
 Pre-tax Corporate Profits                                    
 Including IVA&CCA -6.8 15.2 -1.6 0.9 -7.0 -23.7 5.0 10.8 5.3 3.1 1.9 6.8 6.5 -4.7 3.4 1.6 -4.7 4.3
% of GDP  12.9 13.2 12.9 12.8 12.5 11.5 11.5 11.7 11.7 11.7 11.6 11.7 12.9 11.8 11.7 -- -- --
 GDP Deflator (y/y) 2.4 2.6 2.2 2.5 2.5 2.9 3.2 3.0 2.9 2.3 2.0 2.2 2.4 2.9 2.4 2.5 3.0 2.2
 Nominal GDP  4.7 5.6 5.0 4.8 4.5 5.7 4.3 3.8 5.1 3.8 4.4 4.7 5.3 4.8 4.4 5.0 4.6 4.5
 Labor Force -0.4 0.8 1.4 -0.2 4.7 0.4 0.5 0.5 0.5 0.6 0.6 0.4 0.6 1.5 0.5 0.4 1.5 0.5
 Non-Farm Employment  1.5 1.3 0.9 1.3 0.9 0.5 0.6 0.5 0.9 1.0 1.0 1.0 1.3 0.9 0.8 1.2 0.6 1.0
 Change in Non-Farm Empl. ('000s)  575 514 337 510 375 180 229 200 350 400 400 399 2082 1354 1259 1936 984 1549
 Unemployment Rate (%)  3.8 4.0 4.2 4.2 4.1 4.3 4.4 4.5 4.5 4.4 4.3 4.2 4.0 4.3 4.3 -- -- --
 Personal Disp. Income  9.2 3.6 1.8 5.0 8.3 4.3 3.9 4.5 5.7 5.3 5.2 5.3 5.3 5.0 5.0 4.9 5.3 5.4
 Pers. Savings Rate (%)  5.4 4.9 4.1 3.8 4.7 4.5 4.4 4.5 4.7 4.9 5.2 5.4 4.6 4.5 5.1 -- -- --
 Cons. Price Index (y/y) 3.2 3.2 2.7 2.7 2.9 3.2 3.5 3.5 3.1 2.8 2.7 2.5 3.0 3.3 2.8 2.7 3.5 2.5
 Core CPI (y/y) 3.8 3.4 3.3 3.3 3.1 3.5 3.6 3.4 3.0 2.5 2.4 2.3 3.4 3.4 2.6 3.3 3.4 2.3
 Core PCE Price Index (y/y) 3.0 2.7 2.7 2.8 2.6 2.9 3.0 2.9 2.8 2.3 2.2 2.1 2.8 2.9 2.3 2.8 2.9 2.1
 Housing Starts (mns)  1.4 1.3 1.3 1.4 1.3 1.3 1.3 1.3 1.4 1.4 1.4 1.5 1.4 1.3 1.4 -- -- --
 Real Output per Hour** (y/y) 3.3 3.0 2.5 2.0 2.1 1.8 1.4 1.4 1.3 1.3 1.4 1.3 2.7 1.7 1.3 2.0 1.4 1.3

 

Economic Indicators: G7 & Europe

F: Forecast by TD Economics, March 2025.
* Share of 2022 world gross domestic product (GDP) at PPP.
Source: National Statistics Agencies, TD Economics.
  2023 2024 2025F 2026F
Real GDP (Annual Per Cent Change)
G7 (42.4%)* 1.9 1.7 1.2 1.6
  U.S. 2.9 2.8 1.9 2.0
  Japan 1.5 0.1 0.9 0.8
  Euro Area 0.5 0.8 0.7 1.3
  Germany -0.1 -0.2 0.1 1.9
  France 1.1 1.1 0.4 1.0
  Italy 0.8 0.5 0.4 0.5
  United Kingdom 0.4 0.9 0.8 1.3
  Canada 1.5 1.5 1.3 1.1
Consumer Price Index (Annual Per Cent Change)
G7 4.7 2.8 2.1 2.0
  U.S. 4.1 3.0 3.3 2.8
  Japan 3.3 2.7 1.9 1.7
  Euro Area 5.4 2.4 2.0 1.8
  Germany 6.0 2.5 1.8 1.8
  France 5.7 2.3 1.5 2.0
  Italy 5.9 1.1 1.9 1.5
  United Kingdom 7.3 2.5 2.9 2.3
  Canada 3.9 2.4 2.8 1.9
Unemployment Rate (Per Cent Annual Averages)
  U.S. 3.6 4.0 4.3 4.3
  Japan 2.6 2.5 2.4 2.3
  Euro Area 6.6 6.4 6.7 6.5
  Germany 5.7 6.0 6.2 5.6
  France 7.3 7.4 7.4 7.3
  Italy 7.7 6.6 6.6 7.0
  United Kingdom 4.1 4.3 4.7 4.5
  Canada 5.4 6.4 6.8 6.6
 

Global Economic Outlook

[Annual Per Cent Change Unless Otherwise Indicated]

F: Forecast by TD Economics, March 2025.
* Share of 2022 world gross domestic product (GDP) at PPP. Forecast for India refers to fiscal year.
Source: International Monetary Fund, TD Economics.
2022 Share* Forecast
Real GDP (%) 2024 2025F 2026F
World 100.0 3.2 2.9 2.9
North America 18.9 2.5 1.7 1.8
   United States 15.5 2.8 1.9 2.0
   Canada 1.4 1.5 1.3 1.1
   Mexico 1.9 1.2 0.8 1.4
European Union (EU-27) 14.9 1.0 1.1 1.5
   Euro Area (EU-20) 12.0 0.8 0.7 1.3
        Germany 3.3 -0.2 0.1 1.9
        France  2.3 1.1 0.4 1.0
        Italy 1.9 0.5 0.4 0.5
   Other EU Members 2.8 2.4 3.1 2.7
Asia 45.0 4.4 4.2 3.9
   Japan 3.8 0.1 0.9 0.8
   Asian NIC's 3.5 3.1 2.1 1.9
        Hong Kong 0.3 2.5 2.0 2.3
        Korea 1.7 2.1 1.4 1.8
        Singapore  0.4 4.4 2.9 2.0
        Taiwan 1.0 4.6 3.1 2.0
   Russia 2.9 3.7 1.7 1.5
   Australia & New Zealand 1.2 0.9 1.8 2.6
   Emerging Asia 32.8 5.2 5.1 4.8
        ASEAN-5 5.2 5.0 4.6 4.7
        China 18.4 5.0 4.6 4.3
        India** 7.3 6.2 6.6 6.4
Central/South America 5.4 1.8 2.3 2.0
   Brazil 2.3 2.9 1.7 1.3
Other Emerging Markets 12.7 2.8 3.3 3.5
Other Advanced 3.4 1.2 1.4 2.2
   United Kingdom 2.3 0.9 0.8 1.3

 

Long-Term U.S. Economic Outlook

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

F: Forecast by TD Economics, March 2025.
* 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
24 25F 26F 27F 28F 29F 30F 24 25F 26F 27F 28F 29F 30F
 Real GDP 2.8 1.9 2.0 2.3 2.0 2.0 2.0 2.5 1.5 2.3 2.2 2.0 2.0 2.0
 Consumer Expenditure 2.8 2.3 2.0 2.2 2.1 2.2 2.2 3.1 1.5 2.2 2.2 2.1 2.2 2.2
Durable Goods             3.3 3.2 2.7 3.4 3.0 3.0 3.0 5.7 0.3 3.4 3.3 3.0 3.0 3.0
 Business Investment 3.6 1.9 2.9 3.2 3.2 3.2 3.2 2.2 2.6 3.3 3.2 3.2 3.2 3.2
Non-Res. Structures 3.4 -0.4 2.1 3.0 3.0 3.0 3.0 0.6 0.2 3.0 3.0 3.0 3.0 3.0
Equipment & IPP* 3.4 2.7 3.2 3.3 3.3 3.3 3.3 3.3 3.3 3.4 3.3 3.3 3.3 3.3
 Residential Investment 4.2 -0.7 3.7 8.6 2.9 1.3 1.3 2.8 -1.5 7.9 6.9 1.5 1.3 1.3
 Govt. Expenditure 3.4 1.2 0.2 0.2 0.1 0.1 0.1 3.2 -0.2 0.4 0.2 0.1 0.1 0.2
 Final Domestic Demand 3.0 2.0 1.9 2.2 2.0 1.9 1.9 3.0 1.3 2.3 2.2 1.9 1.9 2.0
 Exports                   3.2 2.0 2.2 3.0 3.0 3.0 3.0 2.9 1.3 2.9 3.0 3.0 3.0 3.0
 Imports                   5.4 2.8 0.7 2.5 2.5 2.5 2.5 5.7 0.5 2.5 2.5 2.5 2.5 2.5
 Change in Private                            
 Inventories 39.4 45.9 39.5 39.5 39.5 39.5 39.5 --- --- --- --- --- --- ---
 Final Sales 2.7 1.9 2.1 2.3 2.0 2.0 2.0 2.6 1.4 2.3 2.2 2.0 2.0 2.0
 Pre-Tax Corporate Profits                            
 Including IVA&CCA 6.5 -4.7 3.4 4.6 4.7 4.5 4.4 1.6 -4.7 4.3 4.5 4.5 4.8 4.1
% of GDP  12.9 11.8 11.7 11.7 11.7 11.7 11.7 --- --- --- --- --- --- ---
 GDP Deflator (y/y) 2.4 2.9 2.4 2.1 2.4 2.3 2.3 2.5 3.0 2.2 2.2 2.3 2.3 2.3
 Nominal GDP  5.3 4.8 4.4 4.4 4.4 4.3 4.3 5.0 4.6 4.5 4.5 4.3 4.3 4.3
 Labor Force 0.6 1.5 0.5 0.4 0.5 0.5 0.5 0.4 1.5 0.5 0.4 0.5 0.5 0.5
 Employment  1.3 0.9 0.8 0.9 0.7 0.7 0.7 1.2 0.6 1.0 0.8 0.7 0.7 0.6
 Change in Empl. ('000s)  2,082 1,354 1,259 1,463 1,213 1,200 1,109 1,936 984 1,549 1,326 1,200 1,200 1,058
 Unemployment Rate (%)  4.0 4.3 4.3 4.0 4.0 4.0 4.0 --- --- --- --- --- --- ---
 Personal Disp. Income  5.3 5.0 5.0 4.4 4.2 4.2 4.2 4.9 5.3 5.4 3.8 4.5 4.1 4.3
 Pers. Savings Rate (%)  4.6 4.5 5.1 5.2 5.2 5.3 5.3 --- --- --- --- --- --- ---
 Cons. Price Index (y/y) 3.0 3.3 2.8 2.2 2.1 2.2 2.2 2.7 3.5 2.5 2.1 2.2 2.2 2.2
 Core CPI (y/y) 3.4 3.4 2.6 2.2 2.2 2.2 2.2 3.3 3.4 2.3 2.2 2.2 2.2 2.2
 Core PCE Price Index (y/y) 2.8 2.9 2.3 2.0 2.0 2.0 2.0 2.8 2.9 2.1 2.0 2.0 2.0 2.0
 Housing Starts (mns)  1.4 1.3 1.4 1.6 1.6 1.6 1.6 --- --- --- --- --- --- ---
 Real Output per Hour** (y/y) 2.7 1.7 1.3 1.6 1.6 1.5 1.5 2.0 1.4 1.3 1.8 1.4 1.6 1.4

Long-Term Canadian Economic Outlook

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

F: Forecast by TD Economics, March 2025.
* 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
24 25F 26F 27F 28F 29F 30F 24 25F 26F 27F 28F 29F 30F
  Real GDP 1.5 1.3 1.1 1.8 2.1 1.9 1.8 2.4 0.6 1.5 2.1 2.0 1.8 1.8
Consumer Expenditure 2.4 2.2 0.6 1.6 2.0 1.9 1.8 3.6 0.7 1.0 1.9 2.0 1.8 1.8
Durable Goods             3.7 3.8 0.2 1.4 1.9 1.8 1.8 4.2 0.0 0.9 1.7 1.9 1.8 1.8
Business Investment -1.5 -0.6 0.7 1.5 1.6 1.6 1.7 2.6 -1.6 1.4 1.6 1.6 1.7 1.7
Non-Res. Structures -1.8 -0.5 0.5 1.5 1.6 1.7 1.7 3.6 -1.9 1.5 1.6 1.6 1.7 1.7
Equipment & IPP* -1.2 -0.7 0.9 1.5 1.6 1.6 1.7 1.6 -1.4 1.4 1.5 1.6 1.7 1.7
Residential Investment -1.1 0.1 1.9 2.3 2.0 1.9 1.8 1.3 -2.7 2.6 2.2 1.9 1.8 1.8
Govt. Expenditure 3.8 3.6 3.9 2.9 2.3 2.1 1.9 4.6 4.0 3.4 2.6 2.2 2.0 1.9
    Final Domestic Demand 2.0 2.2 1.6 1.9 2.0 1.9 1.8 3.5 1.1 1.8 2.1 2.0 1.8 1.8
Exports                   0.6 -0.3 2.3 2.3 2.6 2.5 2.5 0.1 -0.7 2.7 2.5 2.6 2.5 2.5
Imports                   0.6 1.7 3.6 2.4 2.5 2.5 2.5 0.3 2.7 2.8 2.5 2.5 2.5 2.5
Change in Non-Farm                            
Inventories (2012 $Bn) 16.4 9.5 9.5 8.3 9.3 9.7 10.1 -- -- -- -- -- -- --
   Final Sales 2.5 2.5 1.6 2.0 2.0 1.9 1.8 4.7 0.5 2.0 2.0 2.0 1.8 1.8
International Current                            
Account Balance ($Bn)  -15.6 -22.8 -40.5 -41.7 -41.6 -41.7 -42.0 -- -- -- -- -- -- --
% of GDP  -0.5 -0.7 -1.2 -1.2 -1.2 -1.1 -1.1 -- -- -- -- -- -- --
Pre-Tax Corp. Profits -4.2 5.5 2.2 3.8 4.0 3.9 3.8 -3.2 0.2 3.5 4.0 4.0 3.9 3.8
% of GDP  13.0 13.1 13.0 13.0 13.0 13.0 13.0 -- -- -- -- -- -- --
  GDP Deflator (y/y) 3.0 2.9 1.8 1.9 1.9 2.0 2.0 2.2 2.3 1.9 1.9 1.9 2.0 2.0
  Nominal GDP  4.6 4.2 2.9 3.7 4.0 3.9 3.8 4.6 2.9 3.4 4.0 4.0 3.9 3.8
  Labour Force 3.0 1.7 0.1 0.3 0.6 0.6 0.6 2.7 0.8 0.1 0.4 0.6 0.6 0.6
  Employment  1.9 1.2 0.3 0.9 0.8 0.6 0.6 1.6 0.5 0.7 1.0 0.7 0.6 0.6
  Change in Empl. ('000s)  382 249 67 189 165 138 135 327 103 155 203 142 137 133
  Unemployment Rate (%)  6.4 6.8 6.6 6.1 5.9 5.9 5.9 -- -- -- -- -- -- --
  Personal Disp. Income  7.6 5.4 2.2 3.5 3.5 3.4 3.4 7.9 3.3 2.6 3.7 3.4 3.4 3.4
  Pers. Savings Rate (%)  6.1 6.2 6.0 6.1 5.7 5.2 4.8 -- -- -- -- -- -- --
  Cons. Price Index (y/y) 2.4 2.8 1.9 2.0 2.0 2.0 2.0 1.9 2.6 2.1 2.0 2.0 2.0 2.0
  CPIX (y/y) ** 1.8 2.4 2.2 2.1 2.0 2.0 2.0 1.6 2.5 2.2 2.0 2.0 2.0 2.0
  BoC Inflation (y/y) *** 2.8 2.8 2.2 2.0 2.0 2.0 2.0 2.6 2.8 2.1 2.0 2.0 2.0 2.0
  Housing Starts ('000s) 245.1 226.9 214.3 231.8 246.4 243.6 242.6 -- -- -- -- -- -- --
  Home Prices (y/y) 1.9 -3.2 4.8 5.1 4.2 3.3 3.2 5.6 -4.9 6.5 4.8 3.7 3.2 3.2
  Real GDP / Worker (y/y) -0.3 0.1 0.8 0.9 1.3 1.2 1.2 0.7 0.1 0.8 1.1 1.3 1.2 1.2

 

Long-Term Interest Rates

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

F: Forecast by TD Economics, March 2025.
*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
24F 25F 26F 27F 28F 29F 30F 24F 25F 26F 27F 28F 29F 30F
U.S. FIXED INCOME                            
   Fed Funds Target Rate (%)* 5.32 4.25 3.25 3.00 3.00 3.00 3.00 4.50 4.00 3.00 3.00 3.00 3.00 3.00
   3-mth T-Bill Rate (%) 4.97 4.05 3.06 2.90 2.90 2.90 2.90 4.23 3.65 2.90 2.90 2.90 2.90 2.90
   2-yr Govt. Bond Yield (%) 4.37 3.76 3.03 3.00 3.00 3.00 3.00 4.25 3.25 3.00 3.00 3.00 3.00 3.00
   5-yr Govt. Bond Yield (%) 4.13 4.01 3.48 3.45 3.45 3.45 3.45 4.38 3.65 3.45 3.45 3.45 3.45 3.45
   10-yr Govt. Bond Yield (%) 4.21 4.19 3.76 3.75 3.75 3.75 3.75 4.58 3.85 3.75 3.75 3.75 3.75 3.75
  10-yr-2-yr Govt. Spread (%) -0.16 0.42 0.73 0.75 0.75 0.75 0.75 0.33 0.60 0.75 0.75 0.75 0.75 0.75
CANADIAN FIXED INCOME                            
   Overnight Target Rate (%) 4.55 2.50 2.25 2.25 2.25 2.25 2.25 3.25 2.25 2.25 2.25 2.25 2.25 2.25
   3-mth T-Bill Rate (%) 4.38 2.43 2.25 2.25 2.25 2.25 2.25 3.16 2.25 2.25 2.25 2.25 2.25 2.25
   2-yr Govt. Bond Yield (%) 3.50 2.46 2.35 2.35 2.35 2.35 2.35 2.93 2.35 2.35 2.35 2.35 2.35 2.35
   5-yr Govt. Bond Yield (%) 3.30 2.72 2.76 2.75 2.75 2.75 2.75 2.96 2.80 2.75 2.75 2.75 2.75 2.75
  10-yr Govt. Bond Yield (%) 3.34 3.06 3.01 3.00 3.00 3.00 3.00 3.23 3.05 3.00 3.00 3.00 3.00 3.00
  10-yr-2-yr Govt. Spread (%) -0.16 0.60 0.66 0.65 0.65 0.65 0.65 0.30 0.70 0.65 0.65 0.65 0.65 0.65

 

Home Sales and Price Outlook

[Annual Average Growth, %]

Source: CREA, CMHC, TD Economics. Forecasts by TD Economics as of March 2025.
Provinces Home Sales Home Prices
2024 2025F 2026F 2024 2025F 2026F
 National 7.3 -0.9 10.1 1.9 -3.2 4.8
Newfoundland & Labrador 6.1 11.4 -0.5 8.7 4.4 3.4
Prince Edward Island 8.6 7.0 3.7 2.4 -1.0 4.5
Nova Scotia 7.9 6.8 6.0 6.6 4.3 4.3
New Brunswick 4.4 3.4 4.5 10.5 10.7 4.9
Québec 18.9 8.6 1.3 7.4 7.4 4.9
Ontario 3.1 -7.6 16.9 0.3 -6.4 2.2
Manitoba 11.3 6.9 2.4 6.2 4.8 5.4
Saskatchewan 8.9 3.5 6.2 6.4 9.8 5.9
Alberta 9.2 -2.2 7.9 10.0 4.4 5.3
British Columbia 2.1 -0.8 14.7 1.7 -4.1 2.7

 

Disclaimer

This report is provided by TD Economics. It is for informational and educational purposes only as of the date of writing, and may not be appropriate for other purposes. The views and opinions expressed may change at any time based on market or other conditions and may not come to pass. This material is not intended to be relied upon as investment advice or recommendations, does not constitute a solicitation to buy or sell securities and should not be considered specific legal, investment or tax advice. The report does not provide material information about the business and affairs of TD Bank Group and the members of TD Economics are not spokespersons for TD Bank Group with respect to its business and affairs. The information contained in this report has been drawn from sources believed to be reliable, but is not guaranteed to be accurate or complete. This report contains economic analysis and views, including about future economic and financial markets performance. These are based on certain assumptions and other factors, and are subject to inherent risks and uncertainties. The actual outcome may be materially different. The Toronto-Dominion Bank and its affiliates and related entities that comprise the TD Bank Group are not liable for any errors or omissions in the information, analysis or views contained in this report, or for any loss or damage suffered.