Summary
This report provides an economic outlook for Canada in 2026, detailing the anticipated changes and challenges facing the economy. It outlines the expected 1.3 percent growth in GDP, following a 1.7 percent growth in 2025. The document describes a transformation in the economy characterized by a two-speed recovery, with domestic services remaining resilient while export-exposed goods face volatility. It highlights a significant demographic shift, as Canada's population is projected to decline for the first time, necessitating a strategic focus on retaining existing customers rather than acquiring new ones. The report also discusses the acceleration of generative AI adoption, which is expected to enhance productivity. Furthermore, it notes the reorientation of Canadian exports towards Europe and the consolidation of economic activity among larger firms, which may lead to greater efficiency and innovation in the long term. The document emphasizes the need for businesses to adapt to these changes in their planning and strategies.
