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Canada’s GDP Falls Again in May as Early Data Suggests Second-Quarter Growth

Manufacturing growth with anticipated June gains underpins the Bank of Canada’s decision to maintain its policy rate at 2.75%.

A drone view shows shipping containers at the Port of Montreal in Montreal, Quebec, Canada April 14, 2025. REUTERS/Carlos Osorio/File Photo
A worker uses an angle grinder on a vessel under construction at Seaspan Shipyards, in North Vancouver, B.C., on Thursday, October 10, 2024. THE CANADIAN PRESS/Darryl Dyck
Winnipeg Jets fans attend a street party prior to game 2 of the NHL hockey Stanley Cup first-round playoff series against the Colorado Avalanche in Winnipeg, Tuesday, April 23, 2024. THE CANADIAN PRESS/Fred Greenslade
A worker welds at a steel manufacturing facility, in Hamilton on July 16, one of the industries hit by U.S. tariffs.

Overview

  • Canada’s real GDP fell 0.1% in May, matching the downturn in April and marking the second straight monthly contraction.
  • Retail trade declined 1.2% and mining and oil and gas extraction dropped 1%, while manufacturing rebounded by 0.7%.
  • Statistics Canada’s advance figures project a 0.1% increase in June output and 0.1% annualized growth in the second quarter.
  • The Bank of Canada held its policy rate at 2.75% for a third consecutive meeting, citing current data that contradicts earlier forecasts of a Q2 contraction.
  • U.S.-Canada negotiators are working to finalize a tariff-reducing trade agreement by Friday to stem export losses.