OTTAWA—The government’s Fall Economic Statement (FES) painted an improving picture for Ottawa’s fiscal position and a return to black ink even with added targeted support measures for Canadians hurting from elevated inflation. 
The FES is the government’s fall mini-budget and under the government’s base case official projection, which assumes the economy narrowly avoids a recession, the budget deficit for the coming fiscal year ending in March 2023 is $36.4 billion. The feds project deficits to continue to shrink until attaining a fiscal surplus of $4.5 billion in 2027-28. 
But given the expectations of a recession as central banks raise interest rates aggressively, the feds provided a downside scenario which forecasts an economic contraction of 0.9 percent in 2023. Under this scenario, the deficit would be $49.1 billion in 2022-23 and it remains in the red, hitting to $8.3 billion in 2027-28….