Canada's Debt Burden Looks Very Different Depending on Which Measure You Use, BMO Says
MT newswire2026/10/09 11:1507:15 AM EDT, 10/09/2026 (MT Newswires) -- Canada's public finances are under scrutiny as long-term interest rates rise globally, but the country's debt burden varies significantly depending on the measure used, according to BMO Capital Markets in a note. Statistics Canada's latest national accounts data put general government gross debt at 131% of gross domestic product in the second quarter, nearing levels last seen in the mid-1990s, wrote BMO in Thursday's note. The IMF's measure is lower, at about 110% of GDP, but remains above the levels recorded at that time. Net debt tells a markedly different story, said the bank. StatsCan puts general government net debt at just 17% of GDP in the second quarter, its lowest level in at least four decades, while the IMF's estimate is lower still, at 10%. The difference largely reflects the substantial assets held by public-sector pension plans, added BMO. While these funds may not be fully available to meet obligations in a crisis, they help offset future liabilities and must be considered when assessing the government's overall fiscal position. Neither gross nor net debt alone offers a complete picture of Canada's fiscal health. A more balanced gauge may be the combined debt of federal and provincial governments, which stands slightly above 70% of GDP, well below its peak of more than 90% in the mid-1990s, according to the bank.
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