Canadians headed to the polls on Monday in a federal election overshadowed by a worsening economic outlook and growing tensions with the United States, as voters weigh sharply different visions for the country’s future.
Affordability concerns have dominated the campaign, with stagnant wages and slowing productivity growth putting economic issues front and center. But the election of Donald Trump in the United States has added new urgency, shaking up Canada’s trade relationship with its largest partner and roiling the political landscape.
In a stunning reversal of fortune, Canadian Liberals, led by Mark Carney, are expected to win a majority of seats. YouGov predict they could win as many as 204 seats, with a central estimate of 185.
Pierre Poilievre, leader of the Conservative Party, had enjoyed a commanding lead following the chaotic exit of longtime Liberal Prime Minister Justin Trudeau and his minority government late last year. But Carney, a former Bank of Canada and Bank of England governor, has rapidly closed the gap, capitalizing on a tough stance against US trade threats and economic nationalism.
The platforms of Carney and Poilievre have taken divergent approaches to reviving the economy. Both have pledged to eliminate taxes for first-time homebuyers, though Carney aims to boost housing supply through public development initiatives and incentives for multi-family construction. Poilievre, meanwhile, plans to expedite financing and tie federal funding for municipalities to home construction growth.
On trade, Carney has promised retaliatory tariffs against US measures, additional levies, and a strategy to diversify Canada’s trade relationships abroad while removing internal trade barriers. Poilievre advocates a more selective response to US policies, combined with aggressive deregulation to accelerate infrastructure and energy projects by relaxing environmental and climate policies.
Despite the high stakes, Kathleen Brooks, research director at XTB noted the election’s immediate impact on markets may be muted. "The outcome of the election may not shift the dial for the CAD, instead the focus could shift to how quickly and effectively a Carney administration can work with team Trump to repair Canada’s most important economic relationship," she said.
Final results are expected late Monday night.