The Prime Minister’s Economic To-Do List Highlights:

• For all the polarizing language, the Liberal and Conservative economic platforms were similar.
• Expect expanded deficits, with stimulus spending coming in the next few months.
• Trade negotiations will be complicated in a minority government context, and we don’t expect additional counter-tariffs in coming months.
• The Liberal platform takes a few stabs at boosting productivity, but evidently no major policy changes to reverse sluggish long-term growth.

A few years ago the Bank of Canada (BoC) was blindsided by the $30 billion fresh spending announced in Budget 2022, which was a surprise tailwind to already-toasty inflation. This time around, the BoC could be wary of aggressively lowering interest rates ahead of a surge in federal government spending that might reach $100 billion over four years, if Trump barrels ahead with his trade war on the world.

We expect the Canadian dollar to underperform over the next few months. As a procyclical currency, CAD could be dragged down by a global economic slowdown. But it would have been on even thinner ground absent the expected upcoming federal stimulus.

How aggressive will Prime Minister Carney be in confronting President Trump? In the early stages of the campaign, Carney proved combative on the trade front. From media leaks, we know he even entertained a controversial export ban on Canadian oil, one of Canada’s most salient trump cards.

However, since April 2, when Canada was either forgotten, ignored, or willingly excluded from US reciprocal tariffs, Prime Minister Carney has been much more balanced in his tone. Canada is still impacted by a 25% tariff on non-energy goods, 10% tariff on energy, and sectoral tariffs on steel, aluminum, and autos, however exports to the US that are compliant with the Canada-US-Mexico free trade agreement (CUSMA) are exempted. As a result, the effective rate on Canadian exports to the US is around 6%, which is one of the lowest rates in the world. Plus, another 2% of Canadian exports could easily achieve compliance. In our view it’s unlikely that Carney would impose additional counter-tariffs on the US at this point. The existing counter-tariffs on autos, steel, aluminum and $30 billion of ad-hoc manufacturing imports from the US will only add an estimated 0.2%-0.3% to Canadian inflation over the next year.

Check out more insights from Mackenzie Investments on the issues at hand for our country below:

Source: Mackenzie Investments
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DLD has a Youtube Channel!

This year, our founding partner – David Drummond has started a Youtube channel providing tips on common financial planning issues. Watch the latest video above and be sure to subscribe, like and comment!

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DLD in the Media

We have been featured in several media features with the goal to improve Canadian’s financial literacy:

• CBC Radio: Your tax refund is a great opportunity to improve your financial situation
• Globe and Mail: How cash-flow planning in retirement offers control – and makes life more fun
• Globe and Mail: How advisers can better support women
• Globe and Mail: With new rules for gig workers, here’s how freelancers can stay above board this tax season
• Advisor.ca: The week from heck: advisors stepped up to calm clients’ jangled nerves
• Yahoo Finance: What the Bank of Canada interest rate decision today could mean for a housing market hit by Trump tariff uncertainty
• FP Canada: How to get your savings on track at any age – in response to the 2025 Financial Stress Index
• Toronto Star – Volunteering in times of financial hardship can seem impossible. Here’s how to balance giving back with your own finances 

5th Annual Private Wealth Canada West Forum

Dave and Kelly participated in this year’s Private Wealth Canada West Forum as speakers. Dave spoke on a panel on Maximizing Returns: Strategies for Investing in Equity Markets and Kelly moderated a panel on Practice Management & The Future of Wealth management. Lots of insights were shared among our fellow panelists on the importance of diversification among specific asset classes and how AI will help our industry going forward.

Please do not hesitate to contact us if you have any questions or if there’s anything we can do to help. Thank you for your time and from all of us at DLD.

Warmest regards,
Dave, Kelly, Ryan, Aaron, Brandon and Ian

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