Canada's Provincial Economic Outlook: Divided Growth Ahead

The economic forecast for Canada's provinces is looking increasingly divergent, according to TD Economics. While most provinces are expected to see upgrades to their real GDP growth in 2026, regional disparities are set to widen into 2027 due to trade disruptions and higher energy costs.

Alberta, Saskatchewan, and Newfoundland & Labrador are poised to benefit from stronger oil prices, which will boost incomes, profits, and government revenues. These provinces also have relatively low exposure to trade tariffs and export bans, making them more resilient to external shocks.

On the other hand, Ontario, Quebec, Nova Scotia, and New Brunswick face a double headwind from tariff exposure and higher energy costs, with few offsetting benefits from rising commodity prices. Federal and provincial governments have rolled out support measures to mitigate these impacts, including loan programs and wage subsidies.