Canada’s major banks presented positive economic outlooks amidst concerns from numerous smaller businesses affected by the ongoing trade war with the United States. Royal Bank of Canada, Toronto-Dominion Bank, and CIBC released their financial results on Thursday. These banking giants, with collective assets totaling up to $6 trillion, have a broad range of financial products and extensive client networks in both Canada and the U.S., giving them a unique perspective to gauge the impact of tariffs.
RBC CEO Dave McKay expressed optimism about the Canadian economy’s resilience, citing improvements in employment and GDP in the second quarter. He highlighted that despite ongoing trade tensions with the U.S., the average effective tariff rate remains low, with a majority of exports being duty-free.
TD Bank CEO Raymond Chun mentioned a potential “super cycle” for investment in Canada, driven by government spending on infrastructure and national defense projects. He emphasized that Canada’s investment opportunities have not been hindered by trade tensions, with significant projects approved through 2035 and beyond.
CIBC CEO Harry Culham indicated confidence in the latter half of 2026, albeit with a cautious approach towards the evolving trade environment. CIBC is closely monitoring Canada’s labor market for any signs of weakness, considering the potential job losses if the Canada-U.S.-Mexico Agreement is terminated.
BMO Capital Markets forecasts a slight reduction in Canadian growth due to the latest U.S. tariffs, primarily impacting business confidence and investment. Despite these challenges, Canada’s major banks remain positive, with their stocks trading near all-time highs on the Toronto Stock Exchange. The sector’s resilience is evident as they navigate the complexities of the current trade environment.