Three Things We're Watching This Week

CUSMA
It’s clear now that the 25 per cent tariffs that the United States imposed on Canadian goods in March are having a significant impact on the Canadian economy.¹ In Q2, Canada’s GDP declined by annualized 1.6 per cent.² Today, the average effective U.S. tariff rate on Canadian exports is 15 per cent, up from 3 per cent before the tariffs were introduced. It could be worse: exports that fall under the Canada-U.S.-Mexico Agreement (CUSMA) are still tariff-exempt. With CUSMA scheduled for review in 2026, there’s mounting pressure on the Canadian government to secure a new long-term deal sooner rather than later so that the goods that fall under the agreement stay duty-free. “Preserving that exemption is critically important for Canadian producers and exporters,” notes a recent RBC report.³

What we’re watching
In August, Mark Carney removed the retaliatory tariffs on the U.S. to try and accelerate the CUSMA review process – a deal that continues to benefit all three signatories. As RBC’s report on CUSMA notes, the agreement has created a tightly integrated industrial supply chain, with production inputs crossing borders multiple times at different stages of production before reaching the final assembly line. Nearly 20% of the value of U.S. manufacturing imports from Canada and Mexico actually originates from U.S. exports earlier in the production process. That makes the U.S. its own fourth-largest source of manufacturing imports, according to OECD data. Although U.S. trade policy will likely remain highly unpredictable, all parties see value in the agreement. The report’s authors added that the early start to negotiations should allow ample time to address concerns.

Tuition costs rise, again
The cost of education has been rising for years, so if a post-secondary degree is on your radar, it helps to know what to budget for. According to the latest report from Statistics Canada, the average cost of tuition in Canada rose by 1.4 per cent in 2025-2026, reaching $7,734 per year. Once you factor in additional fees charged by colleges and universities, that price jumps to $8,948.⁴ That’s 17 per cent higher than five years ago, or $1,200 more in current dollars. The cost of graduate programs has risen by a more modest 10 per cent over that timeframe, but it’s still about $9,123 including fees. Expect to pay more in provinces like New Brunswick, Saskatchewan, Nova Scotia and Ontario, where tuition and fees exceed $10,000.

What we’re watching
Let’s start with the good news. In 2020, the most recent data available, about 70 per cent of children had some savings for school, and 85 per cent of them had a Registered Education Savings Plan (RESP). Now for the not-so-good news: the average RESP held $22,180 for those aged 13 to 17 – the cohort closest in age to starting a post-secondary degree. That’s barely enough to get you through your second year – or perhaps less if you’re studying away from home. For parents – or grandparents – the earlier you start saving for a child’s education, the more time those contributions have to compound. If you were to contribute $2,500 a year to maximize the Canada Education Savings Grant and maintain a 4% annual return, you could potentially save about $37,500 after 10 years.

The film industry
The Toronto International Film Festival (TIFF),* which celebrated its 50th anniversary this year, has become a can’t-miss event for the film industry. This year’s festival was a hot commodity, featuring many buzzy movies and Hollywood A-Listers on the red carpet. But how is the movie industry faring in the age of streaming? Earlier this year, we saw rosy analyst predictions about cinema audiences resurging around the world, but a recent study showed that Canadians are going to fewer movies: 1.6 tickets per capita were sold in 2024, compared to three in 2019 and 3.6 in 2014.⁵ So, is the silver screen losing its shine? Well, not so fast. Spending on total film production in Canada has been going up. Between 2014 and 2024, total film production spending surged by 68 per cent to $9.58 billion^6,7 – and arguably that understates the growth considering last year’s writer’s strike.

What we’re watching
Theatres are going all out to get bums in seats, from investing in laser projectors⁸ to playing more international films⁹. Even so, the industry is coming off of a disappointing summer, with ticket sales down 0.2 per cent compared to last year and still below pre-pandemic numbers.¹⁰ It’s not that Canadian’s don’t like movies, it’s that their viewing habits have changed. Canadians seem less keen to catch the latest superhero flicks and blockbuster sequels on the big screen, likely because movies now appear on streaming platforms within weeks instead of months. Collectively, the streaming platforms have a valuation north of US$800 billion and, by some estimates, are on track to hit US$2.66 trillion by 2032. As long as people are watching movies – in theatre or in the comfort of their homes – the Canadian film production industry has a massive market to tap into.

Sources
^1. _{RBC Thought Leadership, "Tariffs sting but won't derail North American growth outlook", September 2025}
^2. _{Statistics Canada, "Gross domestic product, income and expenditure, second quarter 2025", August 2025}
^3. _{RBC Thought Leadership, "How CUSMA strengthens both U.S. and Canadian economies", September 2025}
^4. _{Statistics Canada, "Tuition in Canada: Modest increases and widening gaps, 2025/2026", September 2025}
^5. <sub>Telefilm Canada, "2024 Canadian Moviegoing", May 2025
6. Telefilm Canada, "Talent. Together. 2013-2014 Annual Report", 2014
7. Telefilm Canada, "Profile 2024", 2024
8. Barco Visual Solutions, "Cineplex and Cinionic sign multi-year rollout for 800 laser projectors in Canada to bring Laser Projection by Cinionic to the circuit's largest screens", April 2023
9. CBC, "Cineplex says business is back - partly thanks to foreign-language films from around the world", September 2024
10. Los Angeles Times, "Cracks in Hollywood's box office armor: Lessons from another summer bummer", September 2025</sub>

_{* RBC is a sponsor of the Toronto International Film Festival}