We have lowered our GDP growth forecasts by 0.1ppt to 1.3% in 2025 and by 0.5ppts to 1.7% in 2026. The government's plan to cut immigration and the number of temporary residents will cause the population to fall slightly over the next two years. This will overwhelm the small uplift to the economy in 2026 from greater US fiscal stimulus under a second Donald Trump presidency.
Canada: Government plan to shrink population will weaken growth