Marina Lubimova
Bank of Canada Governor Tiff Macklem projects Canadian GDP growth of 1.0% in 2026 and approximately 2.0% in both 2027 and 2028, according to the October 2026 Monetary Policy Report.
GDP Forecast: October vs. July 2026
| Year | July forecast | October forecast | Revision |
| 2026 | 0.7% | 1.0% | +0.3 pp |
| 2027 | 1.8% | 2.0% | +0.2 pp |
| 2028 | 1.8% | 2.0% | +0.2 pp |
*pp = percentage points.
Source: Bank of Canada, October 2026 Monetary Policy Report.Canada GDP Growth Forecasts
Key Economic Indicators
| Indicator | 2026 | 2027 | 2028 |
| GDP growth | 1.0% | 2.0% | 2.0% |
| CPI inflation | 2.9% | 3.1% | 2.2% |
The Bank of Canada raised its policy interest rate by 25 basis points to 2.50% on October 28, 2026, amid persistent inflation pressures.
Factors Behind the Revised Forecast
- Consumer spending: Stronger domestic demand.
- Business investment: Increased capital expenditure supported by federal tax incentives.
- Government spending: Additional support for economic growth.
- Exports: Expected recovery despite US trade uncertainty.
Economic Risks
The main risks include US tariffs, elevated energy prices and higher borrowing costs.
Outlook: Canadian GDP growth is projected to accelerate from 1% in 2026 to 2% in 2027–2028, while inflation is expected to approach the Bank of Canada's 2% target in 2028.
Marina Lubimova
