Canada

01Structure

Canada is a services economy with a resource sector attached, and the resource sector sets the terms. Oil sands production in Alberta is the largest single industrial asset, alongside conventional oil and gas, potash, uranium, timber and metals; manufacturing — vehicles and parts in Ontario, aerospace in Quebec — is concentrated near the American border and integrated into American supply chains.

The structural consequence is that Canadian output responds to commodity prices and to American demand rather than to anything domestic. Productivity growth has lagged the United States for two decades, and a large share of business investment goes into extraction and housing rather than into equipment or intellectual property.

02Trade and exposure

Canada's trade is not diversified in any meaningful sense: over ninety-five per cent of its crude oil exports went to the United States in 2024,¹ and the United States takes roughly three quarters of Canadian merchandise exports overall. Geography and pipelines explain most of it — Canadian crude flows south because that is where the refineries built to process it are.

That concentration became the central economic question in 2026. The United States imposed a fifty per cent tariff on roughly $28 billion of Canadian goods in August, and Canada matched it, applying tariffs from fifteen to fifty per cent on more than seven hundred American products in September.² Diversifying exports away from a single customer is now explicit federal policy,³ and it runs against the direction of every pipeline and rail line the country has.

03Energy and resources

Canada is a large net energy exporter. Oil sands output is projected to keep rising into the 2040s,¹ and the newer development is westward: LNG terminals on the Pacific coast create the first route for Canadian gas that does not end in the United States.

Electricity is a different story from the export picture. Hydro in Quebec, British Columbia, Manitoba and Newfoundland, plus nuclear in Ontario, make Canadian power largely low-carbon already, and the provinces differ enough that there is no single national energy position — which is why energy policy is the most persistent federal-provincial dispute in the country.

04Labour and demography

Canada's labour force has grown mainly through immigration, at rates far above other advanced economies. That policy has recently been reversed in part: the plan for 2026 targets 380,000 new permanent residents and cuts temporary admissions sharply, including a halving of new international students, with the aim of bringing temporary residents below five per cent of the population by the end of 2027.⁴

The reversal followed the strain that rapid population growth placed on housing. It also means the growth in the workforce that flattered Canadian output figures for several years is now being deliberately slowed.

05Public finances

Federal debt is moderate by G7 standards, and the more striking Canadian balance sheet is the household one: debt reached about 179.6 per cent of disposable income in 2026, and 103 per cent of GDP — the highest in the G7, against about 76 per cent in the United States.⁵ Roughly three quarters of it is mortgage debt.

That is the mechanism to watch. Canadian mortgages renew on short terms rather than being fixed for decades, so a change in interest rates reaches household budgets within a few years rather than a generation, and a large volume renews each year.

06Money and prices

The Bank of Canada sets the rate shown above, under an inflation-control target of two per cent agreed jointly with the federal government and renewed every five years — an unusual arrangement that makes the target explicitly political and explicitly temporary.

Transmission is fast for the reason given in section 05: with mortgages renewing on short cycles and household debt at these levels, the policy rate reaches consumption more directly in Canada than in most peers. That is a constraint on how far the Bank can diverge from the Federal Reserve, and the exchange rate absorbs much of the rest.

07What the models expect

These are computed on this site from each series' own history, and are nobody's official projection. The bar is the range the figure lands in half the time; the dot is the central path.

Replayed from past origins on today's revised figures, the same baseline was usually off by 0.50 on consumer price inflation, 1.78 on real gdp, 0.37 on unemployment rate, 0.62 on central bank policy rate, 5.04 on government debt.

08Structural indicators

The figures behind the sections above. They move by a point or two a year, so each carries the year it was measured.

09Sources and method

Live figures: OECD, Bank for International Settlements, OECD via DBnomics. Each is fetched nightly and validated before publication; the delivery report on /status/ says how old every one of them is. Profile written 2026-09-12, next review September 2027.

1. Crude export concentration and the oil sands production outlook — Canada Energy Regulator, Canada's Energy Future 2026
2. The 2026 tariffs and Canada's counter-tariffs — Government of Canada, counter-tariff list; Statement by the Prime Minister, August 2026
3. Export diversification as federal policy — Government of Canada, July 2026
4. The 2026–2028 immigration levels plan — Fragomen, immigration levels plan
5. Household debt relative to income and to GDP — Money.ca, household debt 2026; The Hub, April 2026