FX.co ★ Canada Narrows Budget Deficit in March

In March 2025, Canada reported a budget deficit of CAD 23.9 billion, an improvement from the CAD 33.6 billion deficit recorded in March 2024. This positive shift was largely attributed to a CAD 5.9 billion (15.2%) increase in revenues, mainly owing to enhanced corporate income tax collections. On the expenditure side, program expenses, excluding net actuarial losses, decreased by CAD 3.2 billion (4.7%). This decline was primarily driven by the scheduling of transfers to provinces, territories, and municipalities, partially balanced by heightened transfers to individuals. Additionally, public debt charges reduced by CAD 0.3 billion (6.5%), as the benefits of lower interest rates on treasury bills and net interest from cross-currency swaps surpassed the effects of an increased volume of marketable bonds. Over the complete fiscal year of 2024–25 (April to March), the federal budget deficit amounted to CAD 43.2 billion, compared to CAD 50.9 billion in the prior fiscal year.