Canada’s economic outlook remains weak, with trade uncertainty, sluggish business investment and slower consumer spending weighing on growth.
1. Deloitte Cuts Its Growth Forecast
- 2026 GDP growth: 0.9%
- 2027 GDP growth: 1.6%, revised down from 2.0%
- Main concern: Ongoing US trade uncertainty is discouraging business investment.
2. Canada’s Economy Stalled in July
According to Statistics Canada, real GDP was essentially unchanged in July 2026.
- Construction: Up 1.3%
- Manufacturing: Down 0.9%
- Retail trade: Down 1.0%
These figures highlight uneven economic performance across major industries.
3. What Is Holding Back Growth?
Three significant challenges remain:
- Trade uncertainty: Businesses are delaying investment and expansion.
- Weaker employment: Job insecurity may restrain household spending.
- Slower population growth: Reduced demand could affect housing and consumer markets.
4. What Does This Mean for Mortgages?
A slower economy could influence future Bank of Canada interest rate decisions.
- Variable-rate mortgages: Could benefit if the Bank of Canada cuts its policy rate.
- Fixed-rate mortgages: Depend more heavily on bond yields and market expectations.
- Mortgage renewals: Borrowers should compare fixed and variable options rather than assume rates will decline.
The Bottom Line
Canada’s economy is facing slower growth and continued uncertainty. For homeowners and prospective buyers, careful mortgage planning remains important, particularly when choosing between fixed and variable rates.
Sources: Deloitte Canada and Statistics Canada, September 29, 2026.
Maurice Kwok ・ 郭澤文
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