By Paul Vieira
OTTAWA--Following weeks of equivocations, Canadian Finance Minister Chrystia Freeland said she will deliver a fall economic update before the end of 2024.
The event comes as the ranks of Canada's unemployed shoot up higher, and the economy, which relies on duty-free trade with the U.S. to drive activity, faces the threat of 25% tariffs from President-elect Trump because of concerns over border security.
Freeland provided no further details Friday in a brief media availability in Toronto, where she unveiled government funding to help power artificial-intelligence development. Canada's legislature is currently scheduled to sit until Dec. 17, and return in late January.
For weeks, she said an opposition party-led filibuster was thwarting efforts to present an update on the public finances in the legislature. And she evaded questions about the possibility of presenting the fall update in a location other than parliament, like the previous Conservative government did for years.
"We will deliver a fall economic statement. I'm looking forward to it," Freeland said.
The fall statement is an annual event in which the finance minister presents to lawmakers and Canadians an update to both the economic outlook and public finances. Private-sector economists use the fall statement to update their forecasts for the Canadian government's budget outlook, and provide estimates to clients about how much in bonds the federal government might issue in the year ahead to finance programs and day-to-day administration.
Freeland last year vowed to keep annual budget deficits in Canada limited to no more than 40 billion Canadian dollars, or the equivalent of $28.5 billion. Most economists and the country's budget watchdog believe the annual shortfall is larger than C$40 billion, with some public-finance analysts worrying the Liberal government is abandoning pledges to keep spending and debt levels in check.
Next week, the Bank of Canada delivers its last rate-policy decision of 2024, and traders now expect a second straight half-point rate cut following weaker-than-expected employment data. The unemployment rate in November rose by 0.30 percentage points to 6.8%, or the highest level since January 2017 when excluding the pandemic period.
"Now is the time when all of us need to focus on economic growth, and that is absolutely the government's priority," said Freeland, who last month unveiled a mini stimulus package of over C$6 billion, consisting of a one-time C$250 payment to about 18 million Canadians and a two-month sales-tax exemption on certain goods.
Former Bank of Canada Governor Stephen Poloz said this week he believes Canada is in a recession, even though data indicate the economy is growing although at a tepid pace. He said during a presentation organized by law firm Osler, Hoskin & Harcourt that rapid-fire population growth, fueled by immigration, has masked broad weakness in the economy. This is showing up in declines in gross domestic product per person, he added.
Write to Paul Vieira at paul.vieira@wsj.com
(END) Dow Jones Newswires
12-06-24 1600ET
