06:59 AM EDT, 03/27/2026 (MT Newswires) -- Ontario is projecting a budget deficit of $13.8 billion in the upcoming 2026/27 fiscal year, up slightly from the revised $12.3 billion estimate for fiscal 2025/26, said CIBC.

While that's still a fairly "modest" 1% of gross domestic product, the deficit now projected for the upcoming fiscal year is almost double what was expected in Budget 2025, noted the bank.

The budget forecasts are based on fairly modest projections for GDP growth this year, although those forecasts were set before the outbreak of the Middle East conflict and higher oil prices pose a downside risk to real GDP growth in Ontario, stated CIBC.

Despite a slightly higher budget deficit, as well as increased capital spending expected for fiscal 2026/27, lower maturities see overall financing requirements edge down slightly relative to fiscal 2025/26, pointed out the bank.

Those new requirements are projected to be satisfied through a $6.0 billion increase in short-term funding, $8.0 billion from cash, as well as $47.2 billion of long-term funding, it added.