The

Canadian economy

is expected to come out ahead in 2026 on the

travel and tourism front

since people aren’t letting up on their

boycott of travelling to the United States

, according to

Royal Bank of Canada

economists.

“The

decline in travel

to the U.S. has been both sharp and persistent,” deputy chief economist Nathan Janzen and economist Abbey Xu said in a report on April 9 comparing 2024 and 2025 travel numbers. “But the larger offset has been increased spending on

travel and tourism within Canada

, helping to support the domestic sector.”

Trips by Canadians returning from the U.S. in March dropped 7.6 per cent year over year — 4.5 per cent by automobile and 13.8 per cent by air — according to Statistics Canada data released on Monday.

Car and air trips

south of the border

have consistently fallen by double digits since Donald Trump was sworn in as president in January 2025. There was a 22 per cent drop in January 2026 from the year before, with car trips down 26.3 per cent while air travel fell 12.8 per cent.

The decline in March was smaller than before because return trips to Canada from the U.S. were coming off “already very low levels in March last year,” Janzen said in an interview. Such trips were down 34.9 per cent from March 2024.

He expects the trend to continue, at least in the near term, which he said can be viewed as a “tailwind for domestic Canadian consumer spending … and domestic tourism spending.”

Janzen and Xu said the drop in U.S. travel has been “broad-based,” but the “shorter, discretionary cross-border trips have been particularly affected.”

They estimate same-day trips by Canadians to the U.S. account for nearly half of total travel.

But that doesn’t mean Canadians aren’t travelling For example, more people headed overseas between 2024 and 2025. There was also an increase of 4.9 per cent in Canadians returning from overseas getaways in March, and more Canadians returned from overseas than from the U.S. for the third straight month.

“But the larger offset has been increased spending on travel and tourism within Canada, helping to support the domestic sector,” the economists said.

In 2025, domestic tourism spending rose 2.7 per cent, offsetting a decline of 0.7 per cent by international visitors and echoing the “

Buy Canadian

” credo that people are practising in other spending.

Total tourism spending in Canada was up 1.7 per cent in 2025 versus 2024. In the fourth quarter, tourism gross domestic product (GDP) grew at an annualized rate of 4.8 per cent compared with an overall contraction of 0.6 per cent. It was the third straight quarter that tourism’s growth outpaced the overall economy.

RBC said dollars are being “recycled” at home, with a 5.6 per cent increase in dining accommodation and vehicle rental spending in 2025, while international spending contracted. There were also likely spillover effects in entertainment and recreation.

“Looking ahead, the reallocation in travel patterns is likely to persist in the near term, but not indefinitely,” Janzen and Xu said.

Domestic tourism spending is still coming in ahead of pre-pandemic averages by about 11 per cent.

RBC is calling for “modest” GDP growth this year and a “mixed outlook” for travel, helped by lower interest rates but hindered by slowing population growth, uncertainty around the trade fight with the U.S. and higher fuel costs.

“Growth has moderated from earlier post-pandemic surges, but still reflects steady resilience,” they said.

• Email: gmvsuhanic@postmedia.com

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