Canada’s population contracted 0.2 percent in 2025—the first annual decline on record—driven by net outflows of non-permanent residents after the federal government tightened temporary resident targets. The 2026-2028 Immigration Levels Plan, released in November 2025, further caps new student and temporary worker arrivals while holding permanent resident admissions near 380,000 annually, aiming to reduce the non-permanent share of the population toward 5 percent. Parliamentary Budget Office and Statistics Canada projections point to flat or modestly negative growth through 2026 as outflows continue to offset permanent inflows and low natural increase. These policy shifts and recent quarterly data showing sustained NPR declines underpin the 63 percent market-implied probability that the year-over-year total will finish lower.