Ontario Pushes Provincial Budget Balance Target A Year Later as Deficits Widen, RBC Says

06:48 AM EDT, 10/30/2026 (MT Newswires) -- Ontario delays its balanced-budget target by a year to 2029-30, as Thursday's fiscal update in the Canadian province projects larger deficits over the next few years, according to RBC Economics in a note. The 2026-27 deficit is projected at CA$16.9 billion, CA$3 billion above the spring budget estimate, while forecasts for 2027-28 and 2028-29 have been increased by CA$6.6 billion and CA$7.3 billion, respectively, wrote RBC in a late Thursday note. The weaker fiscal outlook is largely driven by softer economic conditions and lower revenues, while the estimated CA$8 billion cost of the corporate expensing measure isn't yet included, said the bank. Higher reserves and contingencies offer a buffer against economic uncertainty and unexpected expenses. Spending is set to fall in real per capita terms after 2026-27, added RBC. Net debt remains below the 40% gross domestic product target despite rising for five years, while the interest-to-revenue ratio reaches 7.5%, matching the government's limit.