MNI BRIEF: Highlights From 2025-26 Budget Debt Strategy

Update to the 2025-26 Borrowing Plan

The 2025-26 Debt Management Strategy released in July 2025 included projected financial requirements for measures announced between the Fall Economic Statement and June 9, 2025.

Financial requirements for 2025-26 have declined slightly from what was projected

in the 2025-26 Debt Management Strategy released in July 2025. As a result,

treasury bill issuance will decline slightly. Should actual borrowing needs differ

between now and the end of the fiscal year, debt issuance will be adjusted initially

through changes in the issuance of treasury bills.

The bond program is not forecast to change for the remainder of 2025-26. The 30-

year benchmark range (see Table A4.4 below) is being adjusted to ensure that the

current benchmark building cycle is maintained.

Sources of Borrowings

The aggregate principal amount of money to be borrowed by the government in

2026-27 is projected to be $594 billion, down from $614 billion in 2025-26.

Seventy-five per cent of the total borrowings will be used to refinance maturing

debt. This level of borrowing is consistent with the current legislated limit of

$2,126 billion set out in the Borrowing Authority Act.

Actual borrowings for the year may be higher or lower than expected due to

economic and fiscal outcomes differing from projections, the timing of cash

transactions, and other factors such as changes in foreign reserve needs and Crown

corporation borrowings. To adjust for these unexpected changes in financial

requirements, debt issuance can be altered during the year, typically first through

changes in the issuance of treasury bills. The government may also adjust issuance

for bonds in response to larger changes or shifts in market demand.

Foreign Borrowing

Composition of Market Debt

Canada Mortgage Bonds

The Government of Canada, as part of its agenda to catalyse major investments in

housing and to build homes at a rate not seen since the Second World War, will

increase the Canada Mortgage Bonds (CMB) annual issuance limit from $60 billion

to $80 billion, starting in 2026. The increase in this cost-effective funding will solely

apply to multi-unit housing.

The government will maintain the current pace of its purchases of CMBs, up to

$30 billion annually, to allow the private market full access to the additional

issuance.