OTTAWA — The federal government’s annual deficit for the fiscal year ending today is tracking below Ottawa’s own expectations set out the 2025 budget, despite increased spending.
The fiscal monitor published last Friday showed Ottawa’s deficit from April to January came in at $31.2 billion.
With just two months left in the federal fiscal calendar, those levels are well below the $78.3 billion forecast for this year’s annual deficit in the Liberal government’s budget tabled last November.
BMO chief economist Doug Porter says it would be dangerous to project where the federal government will end the fiscal year after just 10 months of results, given that March in particular usually sees a major spike in the deficit related to income tax payouts.
Porter says he does expect the federal government will end the current fiscal year with a deficit below what it forecast in November, due in part to stronger government revenues and interest rates on debt that were lower than Ottawa first projected.
The Liberals are expected to update their economic and fiscal projections later this spring but have not yet set a date to table the statement.
This report by The Canadian Press was first published March 31, 2026.
Craig Lord, The Canadian Press
