What you need to know:
While Canadian economic growth has weathered tariffs much better than what was expected in early 2025, a number of challenges remain prevalent.
Productivity remains a lingering long-term issue that must be addressed, while changes in immigration policy present more near-term challenges for the economy.
Tariffs and trade uncertainty will remain front and center into 2026, with a joint review of the USMCA trade agreement scheduled ahead of the July 1, 2026 deadline.
Trade dynamics have led to a fragmented economy by region and income level, which will result in an uneven growth profile nationally.
Our declining forecast profile for USD/CAD is driven by expected central bank policy settings, broader-based USD direction and hedging flows.
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