The good. The bad. The numbers.

Bullets flying in Washington. War in Iran. High stakes in Islamabad. Bombs in Lebanon. The King in America. (The real one.)

But we have our own maple drama this week with a double-header coming at us from Ottawa. Tomorrow afternoon the Carney government’s first economic update – delivered by that spunky, screechy little Champagne guy – followed the next morning by the central bank’s latest rate news.

The Bank of Canada announcement we already know. No change. The cost of money stays right where it is until the big picture of war, oil, inflation and jobs becomes clearer. Prices are going up again, but the economy’s weak. The best action is no action.

But how about the Craney government? Wassup with that mother of a deficit and how we’re coping in a Trump-tariff world? A year after being elected, and now with a majority, the Libs owe us some data.

Con leader Poilievre, unsurprisingly, says if Mark Carney were any less effective, we’d have to water him twice a week. The country’s a mess, he claims. The worst performer in the G7, drowning in debt while struggling economically because the PM has been jetting everywhere while doing nothing about US trade penalties. Off with his head.

So what should we expect?

True enough, the red ink has been flowing mightily. The feds projected a shortfall of $78.3 billion for the fiscal year which just ended. One of PP’s fav lines, as a result is, “he’s doubled the deficit.”

In real dollar terms, the deficit is the largest ever outside of a pandemic. In terms of the overall economy, not so bad, says Scotia economist Derek Holt. “It’s not even close to a record as a share of the evolving size of the economy. On that, Canada looks much better than virtually anywhere else. It is AAA rated.”

Indeed. We seem to be richer (or at least better off) than most Canadians think. The IMF predicts Canada’s economy will grow at the second-fastest rate in the G7 — behind only the United States — over the next two years. Apparently Canada has the best fiscal position among its peers in the industrialized world.

But wait. It gets better. As it turns out, war smiles upon Canada.

Here, says Holt, is the good news.

The surging price of oil presents a bonanza. Every US$10 rise in the price of a barrel of oil adds between C$1.5–3.5 billion to federal coffers per year. The increase since Budget day on November 4th 2025 has been three times this amount. If sustained, then it could mean between around $5–$10B per year. If they go by the WTI futures curve, then the impact could be just a few billion per year. This is among the reasons why the deficit should be tracking lower than previously guided if only for serendipitous reasons.

And thanks to the ‘peace’ talks in Pakistan being yanked by Trump at the last minute, oil is up again today – another 2% and floating around the $100-a-barrel mark.

So more revenue to Canada, since crude is our largest export, and that should mean a lower deficit.

But wait. The bad news is we might have already spent the surplus.

That top-up on the HST credit announced in January to help lower-income Canadians deal with food inflation (and now $2-a-litre gas) is seriously expensive – $12.6 billion over six years, with a three-billion hit in the current period. And speaking of gas, the feds have lifted their ten-cent excise tax until the autumn. The cost of that is $2.4 billion.

And we didn’t yet mention the major ramping-up of defense spending. The Libs already plowed an extra $9.3 billion into that – part of the $60 billion top-up going for weapons, systems and soldiers Carney had previously announced.

And will there be more spending tomorrow? Maybe. We know the PM will announce a new investment fund today aimed at building out national infrastructure – with units being sold to the public. Imagine that. Just like that silly 19th Century idea of building a railway to the Pacific.

A key question tomorrow, though, is how gritty and realistic the Libs will be?

The entire world (except Russia maybe) has been made poorer and less secure by Trump. The energy shock will take many months to get over. Several places in the world – Gaza, Ukraine, Lebanon, Iran – have recently suffered trillions in damage. Already society is pickled in debt and there’s a limit to what the bond market can swallow before the cost of money starts bubbling higher. And we live in a time now that mighty America has lost prestige, influence, credibility and respect.

Little Canada must navigate all this. Polls show most voters think they chose the right pilot. Soon we will know.

About the picture: “This is Zoey showing off a cool new toy,” writes Wrin. “She’s a sweet 1 yr old heeler.  Thank you for the blog. “

To be in touch or send a picture of your beast, email to ‘garth@garth.ca’.

Source: https://www.greaterfool.ca/2026/04/27/the-good-the-bad-the-numbers/