Posted 11/1/2023, 1:11:00 PM
Trudeau Faces Mounting Pressure to Rein in Spending as Debt Costs Approach Critical Levels
- Canada's debt servicing costs nearing 10% of revenue, a critical threshold according to economists
- Experts say Trudeau should curb spending to avoid market dictating fiscal policy
- Additional spending could complicate Bank of Canada's efforts to tame inflation
- Trudeau faces low polls but deficit spending won't boost popularity now
- Government says fiscal outlook anchored by lowering debt-to-GDP ratio
- But continued spending initiatives eating into fiscal space
- High T-bill issuance indicates weaker finances than expected
- Support from opposition NDP comes with costly demands
- Credit rating agencies monitoring political dynamics and fiscal decisions