As Ottawa’s current fiscal year is about to end March 31, Parliament’s budget watchdog warns the federal deficit could be $26.7-billion.

That would be $5.5-billion more than Yves Giroux’s November forecast.

The Parliamentary budget officer also forecasts the deficit for the coming fiscal year could jump to $112.7-billion; an increase of $89.5-billion from previous forecasts, as government spending rises to tackle the economic fallout from COVID-19 and falling oil prices.

The projected deficit does not include the emergency spending package the Trudeau Liberals announced Wednesday.

The PBO says extra stimulus measures may be needed to ensure the economy hits ”lift-off speed,” especially if consumer and business behaviour does not quickly return to ”normal” fast enough.

Giroux also sees the economy shrinking by 5.1% this calendar year – the largest decline since 1962.