MNI: Canada Apr-Feb Deficit Widens On Spending, Interest Costs

Canada's budget deficit widened CAD2 billion to CAD19.3 billion over April to February from the previous year on program spending and interest costs, the last results voters see before Monday's election with front-runner Liberal Mark Carney pledging wider shortfalls for infrastructure projects to ease damage from the U.S. trade war.

Program expenses excluding net actuarial losses rose CAD42.8 billion or 12%, ahead of the 11% rise in revenue of CAD44.1 billion. Public debt charges increased 15% or by CAD6.5 billion, the finance department's Fiscal Monitor showed Friday.

On a monthly basis for February, the surplus narrowed to CAD7.6 billion from CAD8.3 billion a year earlier.

Canada hasn’t run a substantial budget surplus since 2008, though the country has kept triple-A credit ratings with small deficits as a share of GDP compared with the U.S. Carney last weekend said the deficit will grow to CAD62.3 billion in the fiscal year that began April 1 or 2% of GDP. That's greater than a baseline from Parliament's budget officer for a CAD46.8 billion shortfall equal to 1.5% of GDP and is about a record cash deficit excluding the Covid pandemic. (See: MNI INTERVIEW: Carney Short On 'Big Bang' Reforms- Jack Mintz)