07:19 AM EST, 12/11/2024 (MT Newswires) -- Unless there is some "miraculous" revenue well-spring, Canada's government isn't close to hitting its deficit target of C$40 billion or less for FY2024/25, said Bank of Montreal (BMO).

You don't need the Parliamentary Budget Officer to say finances are offside from prior projections, noted the bank. The monthly budget figures are there for all to see, and the viewing isn't pretty.

The rolling 12-month sum is now running at a deficit of C$55.8 billion, as of September -- six months into the current fiscal year. At the end of the 2023/24 fiscal year in March, that sum was C$50.9 billion.

Now, these aren't the final official figures -- there are year-end adjustments, which could swing the deficit either way, stated BMO. In most years that late adjustment adds to the deficit, but it has reduced the gap the past two fiscal years by an average of more than C$5 billion.

Even with such a possible friendly adjustment, tracking for the current year is running about C$10 billion above the Budget projection of a C$39.8 billion deficit for FY24/25 -- and that was

before the C$6 billion on the GST holiday/rebate combo, added BMO.

Given this arithmetic, it appears that Finance has zigged to focusing instead on the debt/gross domestic product ratio, according to the bank. Here, the bountiful upside revision in the

GDP denominator helps hugely.

2024 nominal GDP is running C$60 billion above Budget expectations, allowing almost C$25 billion of deficit overshoot over two years and still keeping the debt/GDP ratio stable at just above 40%.