Canadian Prime Minister Mark Carney will likely secure a majority government by late Monday once the results of three byelections roll in, said Scotiabank.
As a consequence, Carney's mandate is likely to extend without having to face voters again until 2029, noted the bank.
The outcome could lend supportive stability to the Canadian dollar (CAD or loonie) and domestic markets while emboldening the Carney administration to more aggressively pursue fiscal, regulatory, investment and trade policies without having to depend upon the fragmented opposition, stated Scotiabank.
Two ridings in the Toronto area are Liberal Party strongholds --University-Rosedale and Scarborough Southwest, pointed out the bank. A third riding in Quebec (Terrebonne) may be closer after a very close call between the Liberals and the regional Bloc Quebecois was nulled by the Supreme Court following last April's election. Polls close at 8:30 p.m. ET Monday, with results likely to roll in shortly after.
The Libs' 171 seats after the latest defection put them one seat shy of majority status in the 343-seat House of Commons. In essence, the Libs have a working tacit coalition with the Green Party's solitary seat and the six-member NDP, but one that barely passed last year's Budget by a vote of 170-168 with four abstentions. One more seat, however, would perhaps lessen the Liberals' reliance upon the other minor parties, added Scotiabank.
In fact, polling is driving prediction sites to anticipate a Liberal sweep that would raise the number of seats to 174 -- two more than needed for a majority.
There may nevertheless be limits to party cohesiveness, according to the bank. The Liberals have gained five members who crossed the floor from other parties; four were Conservatives, one was from the NDP. Voters often reject "crossers" when given the next chance to do so. A Liberal majority would, as such, remain partly dependent upon keeping demonstrably unfaithful party members on side in future debates and votes.
Yet the country's democratic ideals are "under strain, " said Scotiabank. Five members of parliament (MP) leveraged their party's platforms, resources, and brand and were voted in by constituents who often vote first -- if not exclusively -- for the party, then perhaps for the person. Their constituents didn't choose to support the Liberal Party when given the chance in a parliamentary election. A shortcoming of the Elections Act is the failure to require a byelection should an MP choose to cross to another party. That failure compromises faith in democracy that breeds cynicism, distrust, and possibly lower voter turnout.
Once a majority is set, the machinations toward a spring fiscal update are likely to be set in higher gear, with a combination of targeted stimulus and updated fiscal position likely.