OTTAWA — The federal Liberals will table their spring economic update on April 28 to give Canadians a look at how new shocks like the Iran war have affected the government’s fiscal position.
Finance Minister François-Philippe Champagne announced the update during question period in the House of Commons on Tuesday. He said it would include a plan to help families, industry and the nation to “prosper.”
The Liberal budget presented in November 2025 was the first tabled under Prime Minister Mark Carney and marked a shift to a new fall budget schedule, with the mid-year fiscal updates now arriving in the spring.
In November, the Liberals projected the federal deficit would rise to $78.3 billion in the last fiscal year, with smaller deficits to follow through to 2030.
Carney has overhauled federal finances since he took over the Liberal leadership more than a year ago.
The prime minister pledged to trim day-to-day government expenses and to hike spending on defence, infrastructure and home building as part of a broader move to reduce reliance on the United States.
He divided the budget into capital and operating streams, planned steep cuts in the size of the public service and ramped up defence spending to meet NATO targets for two per cent of GDP.
The Liberals have promised to shrink the deficit as a share of GDP and balance the operating side of the budget within three years, but the 2025 budget abandoned the previous anchor of a declining debt-to-GDP ratio — something that caused concern for some fiscal watchers.
Carney said Tuesday Canada’s gross domestic product showed signs of rebounding in January and February after contracting in the fourth quarter of 2025.
He also pointed to forecasts from the International Monetary Fund released earlier in the day, which he said rate Canada as the “second-fastest growing economy in the G7.”
Canadian real GDP rose 1.7 per cent in 2025, which the IMF said was half the global average and short of the 2.1 per cent growth recorded in the United States.
The IMF expects the Canadian economy to grow at an annual rate of 1.5 per cent this year and 1.9 per cent in 2027, outpacing most Euro-area economies but trailing the United States. Spain, while not a member of the G7, is also expected to outpace Canada’s economic growth this year.
“The softer near-term profile reflects weaker momentum at the end of 2025 and slower population growth, while earlier monetary easing and supportive fiscal policy help sustain domestic demand,” the IMF report says.
Conflict in the Middle East has sent energy price surging, putting a pinch on consumers at the gas pumps and threatening to push inflation higher in the coming months.
Higher global prices on gasoline also tend to boost federal tax revenues and lift economic activity in oil-producing regions of the country.
Some economists warn that, depending on how long the Iran war lasts, those higher gas prices could eventually hurt the Canadian economy more than they help.
The spring economic update will also incorporate spending promises made since the fall, including a boost to the GST benefit and a new plan announced Tuesday to waive the federal fuel excise tax until Labour Day.
This report by The Canadian Press was first published April 14, 2026.
Craig Lord, The Canadian Press
