Ontario Updates Fiscal and Economic Outlook in 2025–26 Third-Quarter Report

By Peter Paul

TORONTO — Ontario has released updated financial figures outlining the province’s fiscal position partway through the 2025–26 fiscal year, offering revised projections on economic growth, revenues, and the annual budget balance.

The third-quarter disclosure revisits earlier fiscal forecasts and incorporates recent economic developments, including shifts in global trade conditions and broader market uncertainty. Provincial officials say the updated figures show improvement across several key indicators compared with projections released earlier in the fiscal cycle.

Finance Minister Peter Bethlenfalvy said Ontario’s financial position has strengthened over the past year, pointing to improved economic performance and stabilizing revenue trends. He noted that maintaining fiscal capacity remains important as governments continue to navigate international economic pressures.

Data included in the update shows that Ontario’s economy expanded during the third calendar quarter, with real gross domestic product rising 0.5 per cent. Growth was supported largely by external trade activity. For the full 2025 calendar year, real GDP growth is now estimated at 1.2 per cent, exceeding earlier expectations. The province’s net debt relative to the size of the economy is projected to decline to 36.9 per cent, a reduction of 0.8 percentage points from previous forecasts.

The fiscal outlook for the year has also been adjusted. Ontario is now projecting a $13.4-billion deficit for the 2025–26 fiscal year. At the same time, total revenues are expected to reach $223.7 billion, reflecting an increase of $600 million compared with earlier estimates released in the fall.

Officials said the revised outlook suggests a degree of economic resilience despite ongoing external risks, including uncertainty related to international trade measures. The province indicated that further updates will be provided as part of its next budget cycle.

Ontario’s next comprehensive fiscal plan is expected to be released with the 2026 provincial budget, scheduled for publication by March 31, 2026.