Big Banks Bet on Resilient Economy Despite Trade Tensions
Canada's big banks are optimistic about the country's economy, despite growing trade tensions with the United States. Royal Bank of Canada (RBC), Toronto-Dominion Bank (TD Bank), and CIBC reported financial results on Thursday, showcasing their confidence in Canada's economic resilience.
RBC CEO Dave McKay stated that the Canadian economy has proven to be resilient, citing improvements in employment and GDP in Q2 as a cautiously optimistic outlook. TD Bank CEO Raymond Chun referred to an emerging 'super cycle' for investment in Canada, driven by government spending on infrastructure and national defense.
CIBC CEO Harry Culham expressed 'measured confidence' about the back half of 2026, but warned that the trade environment will continue to evolve. Meanwhile, TD Economics estimates that Ottawa and provinces have over $1 trillion in announced projects already approved or on the table through 2035 and beyond.
However, not all experts are as optimistic. BMO Capital Markets predicts that the latest round of US tariffs will carve roughly half a percentage point from Canadian growth, mostly through weaker business confidence and investment. A recent Oxford Economics study also found that over 100,000 Canadian jobs could be lost if the Canada-US-Mexico Agreement (CUSMA) was eliminated.