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Interest Rate Outlook

F: Forecast by TD Economics, May 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 2.85 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 3.15 3.10 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 3.50 3.40 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 3.90 3.75 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 0.65 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 3.90 3.80 3.40 3.35 3.35 3.35 3.35
5-yr Govt. Bond Yield  3.96 3.79 3.74 3.73 3.92 4.05 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 4.35 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 4.95 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 0.75 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 -0.85 -0.85 -0.85 -0.85 -0.85 -0.85 -0.85

 

Foreign Exchange Outlook

F: Forecast by TD Economics, April 2026; Forecasts are end-of-period. Source: Federal Reserve, Bloomberg.
Currency Exchange
Rate		 Spot Price 2025 2026 2027
Apr-16 Q1 Q2 Q3 Q4 Q1 Q2F Q3F Q4F Q1F Q2F Q3F Q4F
Exchange rate to U.S. dollar                          
 Chinese Yuan CNY per USD 6.82 7.26 7.16 7.12 6.99 6.90 6.85 6.80 6.75 6.70 6.65 6.60 6.55
 Japanese yen JPY per USD 159 150 144 148 157 159 159 158 158 157 156 156 155
 Euro USD per EUR 1.18 1.08 1.18 1.17 1.17 1.15 1.18 1.19 1.20 1.20 1.20 1.20 1.20
 U.K. pound USD per GBP 1.35 1.29 1.37 1.34 1.35 1.32 1.35 1.37 1.39 1.39 1.39 1.39 1.39
 Canadian dollar CAD per USD 1.37 1.44 1.36 1.39 1.37 1.40 1.38 1.37 1.35 1.33 1.33 1.33 1.33
 Australian dollar USD per AUD 0.72 0.62 0.66 0.66 0.67 0.69 0.70 0.71 0.71 0.71 0.71 0.71 0.71
 NZ dollar USD per NZD 0.59 0.57 0.61 0.58 0.58 0.57 0.59 0.59 0.60 0.60 0.60 0.60 0.60
Exchange rate to Euro                            
 U.S. dollar USD per EUR 1.18 1.08 1.18 1.17 1.17 1.15 1.18 1.19 1.20 1.20 1.20 1.20 1.20
 Japanese yen JPY per EUR 187 162 170 174 184 183 188 188 189 188 188 187 186
 U.K. pound GBP per EUR 0.87 0.84 0.86 0.87 0.87 0.87 0.88 0.87 0.86 0.86 0.86 0.86 0.86
 Canadian dollar CAD per EUR 1.62 1.55 1.60 1.63 1.61 1.61 1.62 1.63 1.62 1.60 1.60 1.60 1.60
 Australian dollar AUD per EUR 1.64 1.73 1.79 1.77 1.76 1.68 1.68 1.68 1.68 1.68 1.68 1.68 1.68
 NZ dollar NZD per EUR 2.00 1.91 1.93 2.02 2.04 2.02 2.02 2.02 2.02 2.02 2.02 2.02 2.02
Exchange rate to Japanese yen                          
 U.S. dollar JPY per USD 159 150 144 148 157 159 159 158 158 157 156 156 155
 Euro JPY per EUR 187 162 170 174 184 183 188 188 189 188 188 187 186
 U.K. pound JPY per GBP 215 193 198 199 211 210 214 217 219 218 217 217 216
 Canadian dollar JPY per CAD 115.9 104.2 105.9 106.2 114.4 114.0 115.6 115.9 116.8 118.1 117.6 117.1 116.7
 Australian dollar JPY per AUD 114.1 93.5 94.8 97.9 104.6 109.0 111.6 112.1 112.6 112.1 111.7 111.2 110.8
 NZ dollar JPY per NZD 93.7 84.9 87.8 85.8 90.2 90.8 93.0 93.4 93.8 93.4 93.0 92.7 92.3
Exchange rate to Canadian dollar                          
 U.S. dollar USD per CAD 0.73 0.70 0.73 0.72 0.73 0.72 0.73 0.73 0.74 0.75 0.75 0.75 0.75
 Japanese yen JPY per CAD 115.9 104.2 105.9 106.2 114.4 114.0 115.6 115.9 116.8 118.1 117.6 117.1 116.7
 Euro CAD per EUR 1.62 1.55 1.60 1.63 1.61 1.61 1.62 1.63 1.62 1.60 1.60 1.60 1.60
 U.K. pound CAD per GBP 1.86 1.85 1.87 1.87 1.84 1.84 1.85 1.87 1.88 1.85 1.85 1.85 1.85
 Australian dollar AUD per CAD 1.02 1.11 1.12 1.09 1.09 1.04 1.04 1.03 1.04 1.05 1.05 1.05 1.05
 NZ dollar NZD per CAD 1.24 1.23 1.20 1.24 1.27 1.25 1.24 1.24 1.25 1.26 1.26 1.26 1.26

 

Commodity Price Outlook

Source: Forecasts by TD Economics as of May 2026.
Commodity  2025 2026 2027 Annual Average
Q1 Q2 Q3 Q4 Q1 Q2F Q3F Q4F Q1F Q2F Q3F Q4F 2025 2026F 2027F
Crude Oil (WTI, $US/bbl) 72 64 65 59 72 96 86 81 77 74 72 72 65 84 74
Natural Gas ($US/MMBtu) 4.20 3.19 3.03 3.76 4.62 2.75 3.25 3.75 3.85 3.85 3.85 3.85 3.55 3.59 3.85
Gold ($US/troy oz.) 2856 3291 3457 4159 4870 4700 4800 4900 4950 4850 4850 4750 3441 4818 4850
Silver (US$/troy oz.) 31.94 33.78 39.58 55.41 84.05 78.00 77.00 75.00 73.00 72.00 70.00 70.00 40.18 78.51 71.25
Copper ($/lb) 4.23 4.32 4.44 5.05 5.82 5.90 6.00 5.90 5.75 5.80 5.90 6.00 4.51 5.91 5.86
Nickel ($/lb) 7.06 6.88 6.81 6.76 7.87 8.40 8.55 8.25 7.50 7.50 7.50 7.50 6.88 8.27 7.50
Aluminum ($/lb) 1.19 1.11 1.19 1.28 1.45 1.65 1.60 1.62 1.55 1.55 1.50 1.50 1.19 1.58 1.53
Zinc ($/lb) 1.29 1.20 1.28 1.43 1.47 1.53 1.50 1.45 1.45 1.45 1.40 1.40 1.30 1.49 1.43
Wheat ($/bu) 5.65 5.34 4.88 5.13 5.50 6.15 6.30 6.50 6.60 6.65 6.70 6.75 5.25 6.11 6.68
Canola (CAD/tonne) 613 700 605 589 732 720 750 790 790 780 775 775 627 748 780
Lumber ($/1000 board feet) 610 590 606 562 579 595 590 610 615 645 635 630 592 594 631


Canadian Economic Outlook

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

F: Forecast by TD Economics, March 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 Q1F Q2F Q3F Q4F Q1F Q2F Q3F Q4F 25 26F 27F 25 26F 27F
 Real GDP 2.1 -0.9 2.4 -0.6 2.0 1.1 1.5 1.6 1.8 1.9 1.9 1.8 1.7 1.1 1.7 0.7 1.6 1.8
 Consumer Expenditure 1.2 4.7 -0.8 1.7 1.1 0.8 1.3 1.4 1.6 1.7 1.7 1.7 2.3 1.2 1.5 1.7 1.2 1.7
Durable Goods             -5.1 7.1 -3.7 -2.8 1.0 1.1 1.3 1.3 1.5 1.7 1.7 1.7 1.6 0.1 1.5 -1.2 1.2 1.7
 Business Investment -0.7 -2.1 -4.7 2.7 1.0 1.1 1.4 1.6 1.7 1.7 1.7 1.7 -0.2 0.5 1.6 -1.2 1.3 1.7
Non-Res. Structures -2.5 9.3 -0.9 -3.2 1.1 1.2 1.5 1.7 1.7 1.7 1.7 1.7 1.6 0.6 1.6 0.6 1.4 1.7
Equipment & IPP* 1.1 -12.0 -8.4 8.9 1.0 1.0 1.3 1.6 1.6 1.6 1.6 1.6 -1.9 0.4 1.5 -2.9 1.2 1.6
 Residential Investment -11.1 2.0 5.0 -4.4 -4.4 -1.0 0.0 1.0 1.2 1.3 1.3 1.4 1.0 -1.3 0.9 -2.3 -1.1 1.3
 Govt. Expenditure 1.0 5.2 0.0 5.7 3.6 3.3 3.1 3.1 2.8 2.7 2.6 2.4 3.0 3.5 2.8 2.9 3.3 2.6
 Final Domestic Demand -0.1 3.8 -0.5 2.4 1.4 1.4 1.7 1.9 1.9 1.9 1.9 1.9 2.1 1.6 1.8 1.4 1.6 1.9
 Exports                   4.0 -23.6 3.8 6.1 1.2 1.7 1.9 2.1 2.1 2.0 2.0 2.1 -1.7 0.8 2.0 -3.3 1.7 2.1
 Imports                   4.0 0.4 -11.0 1.0 1.3 5.1 5.2 4.3 3.5 2.9 2.8 2.8 -0.4 0.9 3.7 -1.6 4.0 3.0
 Change in Non-Farm                                    
 Inventories (2012, $Bn) -2.0 15.4 1.6 -17.9 -13.4 -8.4 -3.4 -0.9 1.1 2.6 4.1 5.3 -0.7 -6.6 3.2 -- -- --
 Final Sales -2.0 0.1 1.4 6.0 0.7 0.6 0.9 1.5 1.6 1.7 1.7 1.7 2.1 1.8 1.5 1.4 0.9 1.7
 International Current                                    
 Account Balance ($Bn)  -13.6 -84.1 -21.1 -2.8 -0.4 5.6 -18.0 -39.1 -43.1 -46.3 -49.1 -51.5 -30.4 -13.0 -47.5 -- -- --
% of GDP  -0.4 -2.6 -0.6 -0.1 0.0 0.2 -0.5 -1.2 -1.3 -1.3 -1.4 -1.5 -0.9 -0.4 -1.4 -- -- --
 Pre-Tax Corp. Profits 7.3 -17.8 20.4 7.6 -3.0 39.3 -4.8 -18.2 -7.6 2.3 3.2 3.3 5.7 6.3 -3.3 3.4 1.3 0.2
% of GDP  14.4 13.7 14.2 14.3 14.0 15.0 14.7 14.0 13.6 13.5 13.5 13.5 14.1 14.4 13.6 -- -- --
 GDP Deflator (y/y) 3.2 2.1 2.4 2.4 2.7 4.0 3.1 2.2 1.5 0.8 1.1 1.7 2.5 3.0 1.3 2.4 2.2 1.7
 Nominal GDP  6.1 -1.6 6.2 2.3 6.8 5.7 1.8 0.8 3.7 3.8 3.5 3.5 4.3 4.1 3.0 3.2 3.8 3.6
 Labour Force 2.0 1.3 0.5 1.3 -1.6 -0.1 0.0 0.0 0.1 0.2 0.4 0.5 1.9 0.0 0.1 1.3 -0.4 0.3
 Employment  2.3 0.3 0.0 2.4 -1.1 -0.4 0.4 0.4 0.6 0.6 0.6 0.8 1.4 0.2 0.5 1.3 -0.2 0.6
 Change in Empl. ('000s)  118 15 1 127 -58 -19 20 18 30 33 30 42 296 42 99 261 -38 135
 Unemployment Rate (%)  6.7 6.9 7.0 6.7 6.6 6.7 6.6 6.5 6.4 6.3 6.3 6.2 6.8 6.6 6.3 -- -- --
 Personal Disp. Income  3.5 1.8 4.4 2.3 3.3 4.1 0.9 3.0 3.3 3.4 3.4 3.6 4.7 3.0 3.0 3.0 2.8 3.4
 Pers. Savings Rate (%)  5.4 4.5 5.2 4.4 4.3 4.4 3.7 3.8 3.8 3.7 3.7 3.7 4.9 4.1 3.7 -- -- --
 Cons. Price Index (y/y) 2.3 1.8 2.0 2.2 2.1 2.8 2.8 2.3 2.2 1.9 1.9 2.1 2.1 2.5 2.0 2.2 2.3 2.1
 CPIX (y/y)** 2.3 2.6 2.7 2.8 2.5 2.6 2.6 2.3 2.2 2.0 1.9 1.9 2.6 2.5 2.0 2.8 2.3 1.9
 BoC Inflation (y/y)*** 2.8 3.1 3.1 2.9 2.4 2.2 2.3 2.1 2.2 2.0 1.9 2.0 3.0 2.2 2.0 2.9 2.1 2.0
 Housing Starts ('000s) 224 282 273 255 243 240 235 228 225 223 221 219 258 236 222 -- -- --
 Home Prices (y/y) -1.6 -2.5 0.5 -1.8 0.4 1.4 -1.6 -1.1 1.5 1.8 3.2 4.3 -1.4 -0.3 2.7 -1.8 -1.1 4.3
 Real GDP / Worker (y/y) 1.0 0.4 0.4 -0.5 0.3 1.0 0.7 1.7 1.3 1.2 1.2 1.2 0.3 0.9 1.2 -0.5 1.7 1.2

 

U.S. Economic Outlook

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

F: Forecast by TD Economics, March 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 Q1F Q2F Q3F Q4F Q1F Q2F Q3F Q4F 25F 26F 27F 25F 26F 27F
 Real GDP -0.6 3.8 4.4 0.7 2.4 2.1 2.6 2.5 2.2 2.1 2.0 2.0 2.1 2.4 2.2 2.0 2.4 2.1
 Consumer Expenditure 0.6 2.5 3.5 2.0 2.0 2.4 2.2 2.0 2.0 1.9 1.9 2.0 2.6 2.3 2.0 2.1 2.1 2.0
Durable Goods             -3.4 2.3 1.5 0.0 0.0 6.9 4.3 3.0 2.8 2.8 2.8 3.2 3.6 2.3 3.3 0.1 3.5 2.9
 Business Investment 9.5 7.3 3.2 2.3 4.0 4.2 5.7 5.2 3.6 3.6 3.2 3.2 4.1 4.1 4.1 5.5 4.7 3.4
Non-Res. Structures -3.1 -7.5 -5.0 -7.1 -3.0 -2.0 1.0 1.0 1.0 1.0 1.0 1.0 -5.3 -3.4 0.8 -5.7 -0.8 1.0
Equipment & IPP* 13.4 11.8 5.4 5.4 5.8 5.7 6.9 6.2 4.2 4.3 3.7 3.7 7.0 6.2 4.9 8.9 6.2 4.0
 Residential Investment -1.0 -5.1 -7.1 -0.6 -1.1 2.2 5.8 5.7 5.9 4.5 3.6 3.3 -2.1 -0.2 4.9 -3.5 3.1 4.3
 Govt. Expenditure -1.0 -0.1 2.2 -5.8 5.9 0.7 0.7 0.6 0.7 0.7 0.7 0.7 1.1 0.8 0.7 -1.2 2.0 0.7
 Final Domestic Demand 1.4 2.4 2.8 0.6 2.8 2.3 2.5 2.3 2.1 2.0 1.9 2.0 2.4 2.2 2.2 1.8 2.5 2.0
 Exports                   0.2 -1.8 9.6 -3.3 4.3 2.7 3.0 3.0 3.0 3.0 3.0 3.0 1.6 2.5 3.0 1.0 3.3 3.0
 Imports                   38.0 -29.3 -4.4 -1.1 11.0 5.1 3.6 2.8 2.5 2.5 2.5 2.5 2.7 1.2 2.8 -2.0 5.6 2.5
 Change in Private Inventories 172.0 -18.3 -23.9 -7.5 16.1 23.0 33.0 42.9 42.9 42.9 42.9 42.9 30.6 28.7 42.9 -- -- --
 Final Sales -3.2 7.5 4.5 0.4 1.9 2.0 2.4 2.3 2.2 2.1 2.0 2.0 2.2 2.4 2.2 2.2 2.2 2.1
 Pre-tax Corporate Profits                                    
 Including IVA&CCA -4.7 0.7 19.1 12.5 7.0 6.5 3.8 4.0 -0.4 0.0 -0.4 1.4 6.4 8.3 1.6 6.5 5.3 0.2
% of GDP  13.1 12.9 13.2 13.4 13.5 13.6 13.5 13.5 13.3 13.2 13.0 13.0 13.2 13.5 13.1 -- -- --
 GDP Deflator (y/y) 2.6 2.5 3.0 3.3 3.1 3.2 2.7 2.4 2.2 2.3 2.3 2.3 2.8 2.9 2.3 3.3 2.4 2.3
 Nominal GDP  2.9 6.0 8.3 4.5 5.6 4.5 4.6 5.1 4.3 4.7 4.2 4.4 5.0 5.4 4.6 5.4 4.9 4.4
 Labor Force 5.4 0.1 0.4 1.6 -2.1 0.3 0.3 0.2 0.3 0.2 0.1 0.2 1.6 -0.1 0.2 1.8 -0.3 0.2
 Non-Farm Employment  0.5 0.4 0.1 -0.2 0.2 0.2 0.4 0.6 0.6 0.5 0.3 0.3 0.5 0.2 0.5 0.2 0.3 0.4
 Change in Non-Farm Empl. ('000s)  205 169 34 -91 80 86 160 223 240 180 120 100 745 271 729 317 549 640
 Unemployment Rate (%)  4.1 4.2 4.3 4.5 4.4 4.4 4.3 4.2 4.1 4.0 4.0 4.0 4.3 4.3 4.0 -- -- --
 Personal Disp. Income  5.8 4.0 3.8 3.1 8.3 5.7 5.3 6.0 5.6 5.7 5.4 5.1 4.4 5.5 5.6 4.2 6.3 5.5
 Pers. Savings Rate (%)  5.2 5.0 4.4 4.0 4.1 4.0 4.3 4.7 5.2 5.6 5.9 6.1 4.7 4.3 5.7 -- -- --
 Cons. Price Index (y/y) 2.7 2.5 2.9 2.7 2.9 3.8 3.4 3.2 2.4 1.6 1.8 1.9 2.7 3.3 1.9 2.7 3.2 1.9
 Core CPI (y/y) 3.1 2.8 3.1 2.7 2.7 2.9 2.7 2.9 2.6 2.4 2.3 2.2 2.9 2.8 2.4 2.7 2.9 2.2
 Core PCE Price Index (y/y) 2.8 2.7 2.9 2.9 3.0 3.1 3.0 2.8 2.4 2.1 2.1 2.0 2.8 3.0 2.1 2.9 2.8 2.0
 Housing Starts (mns)  1.40 1.35 1.35 1.33 1.32 1.35 1.39 1.43 1.45 1.48 1.50 1.52 1.36 1.37 1.49 -- -- --
 Real Output per Hour** (y/y) 2.0 2.1 2.4 2.8 3.8 3.4 2.6 2.4 1.9 1.7 1.6 1.5 2.3 3.0 1.7 2.8 2.4 1.5

 

Economic Indicators: G7 & Europe

F: Forecast by TD Economics, March 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 (28.7%)* 1.6 1.7 1.8
  U.S. 2.1 2.4 2.2
  Japan 1.1 0.5 0.8
  Euro Area 1.5 0.9 1.3
  Germany 0.4 0.8 1.7
  France 0.9 1.0 1.4
  Italy 0.7 0.6 0.9
  United Kingdom 1.3 0.9 1.3
  Canada 1.7 1.1 1.7
Consumer Price Index (Annual Per Cent Change)
G7 2.3 2.2 2.0
  U.S. 2.7 3.3 1.9
  Japan 3.2 2.2 1.7
  Euro Area 2.1 2.8 2.1
  Germany 2.3 2.1 1.9
  France 0.9 1.6 1.5
  Italy 1.6 2.2 1.5
  United Kingdom 3.4 2.6 1.9
  Canada 2.1 2.5 2.0
Unemployment Rate (Per Cent Annual Averages)
  U.S. 4.3 4.3 4.0
  Japan 2.5 2.5 2.3
  Euro Area 6.3 6.3 6.2
  Germany 6.3 6.1 5.5
  France 7.7 7.6 7.3
  Italy 6.1 6.0 6.3
  United Kingdom 4.9 5.2 4.9
  Canada 6.8 6.6 6.3
 

Global Economic Outlook

[Annual Per Cent Change Unless Otherwise Indicated]

F: Forecast by TD Economics, March 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 3.1 3.1
North America 17.9 2.0 2.3 2.2
   United States 14.8 2.1 2.4 2.2
   Canada 1.3 1.7 1.1 1.7
   Mexico 1.7 0.8 1.6 1.9
European Union (EU-27) 14.2 1.6 1.2 1.5
   Euro Area (EU-20) 12.2 1.5 0.9 1.3
        Germany 3.0 0.4 0.8 1.7
        France  2.2 0.9 1.0 1.4
        Italy 1.8 0.7 0.6 0.9
   Other EU Members 3.8 3.0 3.0 2.3
Asia 46.9 4.8 4.2 4.1
   Japan 3.3 1.1 0.5 0.8
   Asian NIC's 3.5 3.7 2.6 2.0
        Hong Kong 0.3 3.5 2.4 2.2
        Korea 1.6 0.9 2.0 2.1
        Singapore  0.5 5.0 3.6 2.1
        Taiwan 0.9 8.7 3.7 2.0
   Russia 3.5 0.8 0.9 1.0
   Australia & New Zealand 1.2 1.8 2.4 2.4
   Emerging Asia 35.7 5.7 5.0 5.0
        ASEAN-5 5.2 5.3 4.7 4.9
        China 19.3 5.0 4.5 4.4
        India** 8.2 7.7 6.5 6.3
Central/South America 5.3 2.9 1.7 2.3
   Brazil 2.4 2.6 1.2 2.1
Other Emerging Markets 12.8 3.6 3.3 3.0
Other Advanced 3.2 1.2 1.4 2.2
   United Kingdom 2.2 1.3 0.9 1.3

 

Long-Term U.S. Economic Outlook

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

F: Forecast by TD Economics, March 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 2.4 2.2 2.0 2.0 2.0 2.0 2.0 2.4 2.1 1.9 2.0 2.0 2.0
 Consumer Expenditure 2.6 2.3 2.0 2.0 2.2 2.2 2.2 2.1 2.1 2.0 2.1 2.2 2.2 2.2
Durable Goods             3.6 2.3 3.3 3.3 3.5 3.5 3.5 0.1 3.5 2.9 3.5 3.5 3.5 3.5
 Business Investment 4.1 4.1 4.1 2.9 2.7 2.7 2.7 5.5 4.7 3.4 2.7 2.7 2.7 2.7
Non-Res. Structures -5.3 -3.4 0.8 1.6 2.0 2.0 2.0 -5.7 -0.8 1.0 2.0 2.0 2.0 2.0
Equipment & IPP* 7.0 6.2 4.9 3.2 2.9 2.9 2.9 8.9 6.2 4.0 2.9 2.9 2.9 2.9
 Residential Investment -2.1 -0.2 4.9 3.1 2.8 2.2 1.7 -3.5 3.1 4.3 2.8 2.8 1.8 1.6
 Govt. Expenditure 1.1 0.8 0.7 0.5 0.3 0.1 0.1 -1.2 2.0 0.7 0.4 0.3 0.1 0.1
 Final Domestic Demand 2.4 2.2 2.2 1.9 2.0 1.9 1.9 1.8 2.5 2.0 1.9 2.0 1.9 1.9
 Exports                   1.6 2.5 3.0 3.0 3.0 3.0 3.0 1.0 3.3 3.0 3.0 3.0 3.0 3.0
 Imports                   2.7 1.2 2.8 2.5 2.5 2.5 2.5 -2.0 5.6 2.5 2.5 2.5 2.5 2.5
 Change in Private                            
 Inventories 30.6 28.7 42.9 42.9 42.9 42.9 42.9 --- --- --- --- --- --- ---
 Final Sales 2.2 2.4 2.2 2.0 2.0 2.0 2.0 2.2 2.2 2.1 2.0 2.0 2.0 2.0
 Pre-Tax Corporate Profits                            
 Including IVA&CCA 6.4 8.3 1.6 0.6 1.7 2.7 4.1 6.5 5.3 0.2 0.7 2.2 3.2 4.7
% of GDP  13.2 13.5 13.1 12.7 12.3 12.2 12.1 --- --- --- --- --- --- ---
 GDP Deflator (y/y) 2.8 2.9 2.3 2.3 2.2 2.2 2.3 3.3 2.4 2.3 2.3 2.3 2.2 2.3
 Nominal GDP  5.0 5.4 4.6 4.4 4.3 4.3 4.3 5.4 4.9 4.4 4.3 4.3 4.3 4.3
 Labor Force 1.6 -0.1 0.2 0.3 0.4 0.4 0.4 1.8 -0.3 0.2 0.4 0.4 0.4 0.4
 Employment  0.5 0.2 0.5 0.3 0.3 0.2 0.2 0.2 0.3 0.4 0.2 0.2 0.2 0.2
 Change in Empl. ('000s)  745 271 729 429 400 400 400 317 549 640 399 400 400 400
 Unemployment Rate (%)  4.3 4.3 4.0 4.0 4.0 4.0 4.0 --- --- --- --- --- --- ---
 Personal Disp. Income  4.4 5.5 5.6 5.2 4.9 4.7 4.6 4.2 6.3 5.5 5.0 4.8 4.7 4.6
 Pers. Savings Rate (%)  4.7 4.3 5.7 6.7 7.3 7.7 8.0 --- --- --- --- --- --- ---
 Cons. Price Index (y/y) 2.7 3.3 1.9 2.2 2.2 2.2 2.2 2.7 3.2 1.9 2.2 2.2 2.2 2.2
 Core CPI (y/y) 2.9 2.8 2.4 2.2 2.2 2.2 2.2 2.7 2.9 2.2 2.2 2.2 2.2 2.2
 Core PCE Price Index (y/y) 2.8 3.0 2.1 2.0 2.0 2.0 2.0 2.9 2.8 2.0 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 3.0 1.7 1.6 1.6 1.5 1.5 2.8 2.4 1.5 1.5 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, March 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 1.7 1.1 1.7 1.8 1.8 1.7 1.7 0.7 1.6 1.8 1.8 1.7 1.7 1.7
Consumer Expenditure 2.3 1.2 1.5 1.7 1.7 1.7 1.7 1.7 1.2 1.7 1.7 1.7 1.7 1.7
Durable Goods             1.6 0.1 1.5 1.7 1.7 1.7 1.7 -1.2 1.2 1.7 1.7 1.7 1.7 1.7
Business Investment -0.2 0.5 1.6 1.7 1.7 1.7 1.7 -1.2 1.3 1.7 1.7 1.7 1.7 1.7
Non-Res. Structures 1.6 0.6 1.6 1.7 1.7 1.7 1.7 0.6 1.4 1.7 1.7 1.7 1.7 1.7
Equipment & IPP* -1.9 0.4 1.5 1.6 1.7 1.7 1.7 -2.9 1.2 1.6 1.7 1.7 1.7 1.7
Residential Investment 1.0 -1.3 0.9 1.4 1.6 1.6 1.7 -2.3 -1.1 1.3 1.5 1.6 1.6 1.7
Govt. Expenditure 3.0 3.5 2.8 2.4 2.1 1.9 1.8 2.9 3.3 2.6 2.2 2.0 1.9 1.8
    Final Domestic Demand 2.1 1.6 1.8 1.9 1.8 1.8 1.7 1.4 1.6 1.9 1.8 1.8 1.7 1.7
Exports                   -1.7 0.8 2.0 2.2 2.3 2.4 2.5 -3.3 1.7 2.1 2.2 2.4 2.4 2.5
Imports                   -0.4 0.9 3.7 2.7 2.6 2.6 2.5 -1.6 4.0 3.0 2.7 2.6 2.6 2.5
Change in Non-Farm                            
Inventories (2012 $Bn) -0.7 -6.6 3.2 7.8 11.0 11.7 12.1 -- -- -- -- -- -- --
   Final Sales 2.1 1.8 1.5 1.7 1.7 1.7 1.7 1.4 0.9 1.7 1.7 1.7 1.7 1.7
International Current                            
Account Balance ($Bn)  -30.4 -13.0 -47.5 -56.1 -61.4 -65.0 -67.8 -- -- -- -- -- -- --
% of GDP  -0.9 -0.4 -1.4 -1.6 -1.6 -1.7 -1.7 -- -- -- -- -- -- --
Pre-Tax Corp. Profits 5.7 6.3 -3.3 3.3 3.3 3.0 3.1 3.4 1.3 0.2 3.5 3.1 3.1 3.2
% of GDP  14.1 14.4 13.6 13.5 13.5 13.4 13.3 -- -- -- -- -- -- --
  GDP Deflator (y/y) 2.5 3.0 1.3 1.7 1.9 1.9 2.0 2.4 2.2 1.7 1.8 1.9 2.0 2.0
  Nominal GDP  4.3 4.1 3.0 3.6 3.7 3.7 3.7 3.2 3.8 3.6 3.6 3.7 3.7 3.7
  Labour Force 1.9 0.0 0.1 0.5 0.6 0.6 0.6 1.3 -0.4 0.3 0.6 0.6 0.6 0.6
  Employment  1.4 0.2 0.5 0.9 0.7 0.6 0.6 1.3 -0.2 0.6 0.9 0.6 0.6 0.6
  Change in Empl. ('000s)  296 42 99 182 155 134 131 261 -38 135 197 137 133 130
  Unemployment Rate (%)  6.8 6.6 6.3 6.0 5.9 5.9 5.9 -- -- -- -- -- -- --
  Personal Disp. Income  4.7 3.0 3.0 3.6 3.6 3.6 3.6 3.0 2.8 3.4 3.7 3.6 3.6 3.6
  Pers. Savings Rate (%)  4.9 4.1 3.7 3.8 3.8 3.7 3.6 -- -- -- -- -- -- --
  Cons. Price Index (y/y) 2.1 2.5 2.0 2.0 2.0 2.0 2.0 2.2 2.3 2.1 2.0 2.0 2.0 2.0
  CPIX (y/y) ** 2.6 2.5 2.0 2.0 2.0 2.0 2.0 2.8 2.3 1.9 2.0 2.0 2.0 2.0
  BoC Inflation (y/y) *** 3.0 2.2 2.0 2.0 2.0 2.0 2.0 2.9 2.1 2.0 2.0 2.0 2.0 2.0
  Housing Starts ('000s) 258.2 236.4 222.2 226.1 233.7 233.5 233.0 -- -- -- -- -- -- --
  Home Prices (y/y) -1.4 -0.3 2.7 4.6 3.8 3.3 3.3 -1.8 -1.1 4.3 4.4 3.4 3.3 3.2
  Real GDP / Worker (y/y) 0.3 0.9 1.2 1.0 1.1 1.1 1.1 -0.5 1.7 1.2 0.9 1.1 1.1 1.1

 

Long-Term Interest Rates

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

F: Forecast by TD Economics, May 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 3.63 3.25 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 3.63 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 3.72 3.36 3.35 3.35 3.35 3.35 3.47 3.40 3.35 3.35 3.35 3.35 3.35
   5-yr Govt. Bond Yield (%) 3.93 3.88 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 4.26 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 0.54 0.75 0.75 0.75 0.75 0.75 0.71 0.75 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 2.77 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 3.05 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 3.42 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 0.65 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

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.