Key points

• Alberta’s economy is forecast to grow faster than the national economy in 2026 and 2027.
• A revived energy sector is providing a boost to Alberta’s growth.
• Higher inflation and borrowing costs will strain many households and businesses.

Our September Economic Outlook is out!

Forecasting is never easy, but this is a particularly tough time to make a call.

There are numerous challenges, like rising borrowing costs and affordability pressures, ongoing trade tensions with the U.S., and the war in Iran.

But there is also opportunity. The upside in our forecast comes from steps taken in Canada that could improve its growth prospects. There is deepening recognition that, in a time of geopolitical instability, Canada has the resources the world wants, and now a resolve to get projects built and expand overseas exports.

In our latest outlook, we’re not taking all the upside or the downside. As always, we forecast down the middle. This translates into a forecast of 2.6% real GDP growth in 2026, well above the 0.9% projected nationally. Looking ahead to 2027, the provincial economy is expected to expand by 2.3%, outpacing national growth of 1.5%.

We anchor our forecast to the latest data, which shows that Alberta is far outpacing the rest of the country on a broad range of indicators this year—from growth in employment to population and retail sales.

There are numerous contributors to Alberta’s current outperformance. Topping the list is a lighter overall U.S. tariff burden, rising oil prices and new market access for energy, and persistent inflows of interprovincial migrants. While there is further energy upside, ATB Economics maintains a cautious outlook on investment until final decisions are made on a new West Coast Pipeline and oil sands projects that would fill it.

Despite stronger growth in Alberta, there are challenges like ongoing affordability pressures, expectations of higher interest rates and youth underemployment. Many businesses have also cited the uncertainty over the October referendum as having an impact. Further, despite a lower overall tariff burden in the province, some businesses dealing with sectoral tariffs of up to 50% face significant impacts.

I’ll end on a positive note. If recent signals and policies turn into actual project approvals and investment, there is upside to our growth forecast for both Alberta and Canada.

Answer to the previous trivia question: The largest urban area in Atlantic Canada is the Halifax Census Metropolitan Area with a population of 544,834 in 2025.

Today’s trivia question: Which province (as of July 1, 2026) had the highest number of non-permanent residents as a percentage of its total population?