Global Markets: Federal budget passes, government survives

WINNIPEG – The following is a glance at the news moving markets in Canada and globally.

– Canada’s federal budget was passed in the House of Commons on Monday night through a confidence vote, avoiding the possibility of an election. The budget, which outlines nearly C$500 billion worth of spending and C$101 billion towards new programs over a three-year period, received support from the New Democratic Party, passing with a 178-157 margin. Canadians won’t likely go to the polls this spring, but a snap election could still be called this year in an attempt by the Liberals to regain their majority in the House.

– The Canadian Armed Forces will send up to three medical assistance teams to Ontario, the federal government announced on Monday, after the province requested help for its hospitals overwhelmed by rising COVID-19 case numbers. In addition, the federal government said it would also “fund the redeployment of the Canadian Red Cross to augment or relieve staff within medical care facilities.”

– S&P Global Ratings has maintained Canada’s top-level AAA credit rating despite the federal government’s recent decision to run historic deficits. In a report released on Monday afternoon, S&P stated that, “Canada’s public finances were well positioned entering the pandemic, enabling a strong policy response to contain its negative effects without weakening sovereign creditworthiness.” S&P is projecting 5.5 per cent growth in 2021, followed by 2.4 per cent in 2022 and 2.8 per cent in 2023. However, the report also warned S&P could downgrade Canada’s rating by 2023 if deficits become larger.

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