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Canada's Economy Is Slowing: 5 Money Moves to Make Before Year-End

  Canadian Money Brief | October 22, 2026 Canada's economic outlook has weakened, and that is a good reason to take a fresh look at your finances before the end of the year. The Parliamentary Budget Officer's October outlook projects real GDP growth of just 0.9% in 2026, down from its earlier forecast of 1.1%. The report points to changing trade conditions and U.S. tariffs as key pressures. This does not mean a recession is guaranteed. But when the economy faces uncertainty, a few practical steps can help households stay prepared and avoid unnecessary costs. 1. Review your monthly budget Check your last two or three months of bank and credit-card statements. Look for subscriptions you no longer use, recurring fees, food waste, and purchases that can be delayed. Even small cuts can free up cash for savings or debt repayment. Try this: Choose one spending category to reduce this month and move the money you save into a separate savings account. 2. Build or top up your emergency ...
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Bank of Canada's Rate Cuts: The Diminishing Appeal of Cash Investments

As the Bank of Canada continues to slash interest rates, the traditional appeal of holding cash in your investment portfolio is rapidly diminishing. With the latest rate cut bringing the benchmark rate down to 3.25%, the returns on cash deposits are becoming increasingly unattractive compared to other investment options.

In a low-interest-rate environment, cash holdings yield minimal returns, failing to keep pace with inflation. This erosion of purchasing power means that investors are better off exploring alternative assets that offer higher potential returns. Equities, for instance, can provide capital appreciation and dividends, while bonds, especially those with longer durations, can offer more attractive yields.

Moreover, the Bank of Canada's indication of a slower pace of future rate cuts suggests that the window for higher interest rates on cash deposits may remain narrow for some time. Investors should consider diversifying their portfolios to include a mix of growth-oriented and income-generating assets to mitigate the impact of low interest rates.

In conclusion, while cash is essential for liquidity and risk management, relying too heavily on it in the current economic climate can hinder overall portfolio performance. It's time to reassess your investment strategy and consider opportunities that can better withstand the challenges posed by persistently low interest rates.




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