07:10 AM EDT, 08/30/2024 (MT Newswires) -- The Canadian province of New Brunswick revised its FY24/25 budget balance from a small surplus to a small deficit, noted Bank of Montreal (BMO).

While that might be a trivial revision for a very small province, it's notable because almost every province in Canada, with the exception of Alberta, is now looking at a budget deficit for this fiscal year, said the bank.

To be fair, deficit sizes aren't overly large, with perhaps the exception of British Columbia -- pushing 2% of gross domestic product (GDP) and already the recipient of a negative credit-rating action, stated BMO.

However, it's indicative that the easy years for provincial finances are behind Canada, pointed out the bank.

Provinces are no longer banking big revenue windfalls (inflation and economic recovery), but they are dealing with plenty of cost pressure -- such as health care and compensation. They're also heavy borrowers with significant infrastructure demands, added BMO.

Overall, the group is still in decent shape with the combined deficit pegged at just under 1% of GDP for this fiscal year, but the bank will be keeping a close eye during the busier fall fiscal update season.