Canada's GDP Also Seen Contracting in May After April's Unexpected Decline Due to Manufacturing Sector Slide

08:50 AM EDT, 06/27/2025 (MT Newswires) -- Canadian real gross domestic product edged down 0.1% month over month in April, following a 0.2% month-over-month increase in March, said the country's statistical agency on Friday.

April contraction was worse than a flat consensus reading provided by MUFG.

Also, Statistics Canada said advance information indicates real GDP decreased 0.1% month over month in May. According to StatsCan, decreases in mining, quarrying, and oil and natural gas extraction, public administration and retail trade were partially offset by an increase in real estate and rental and leasing.

On the April data, StatsCan said the goods-producing industries were down 0.6% month over month, with the manufacturing sector accounting for nearly all the decline.

It added the services-producing industries edged up 0.1% month over month in April. Public administration, finance and insurance, and the arts, entertainment and recreation sectors contributed the most to the increase, while the wholesale trade sector was the largest detractor to growth. Overall, 10 of 20 industrial sectors expanded in April.

The manufacturing sector was down 1.9% month over month in April, the largest drop since April 2021, reflecting broad-based declines across both durable and non-durable goods manufacturing aggregates.

The transportation equipment manufacturing subsector (-3.7%) was the largest contributor to the decline, argely attributed to other transportation equipment (-21.6%), which posted its first decline in six months, and motor vehicle manufacturing (-5.2%), coinciding with lower exports of passenger cars and light trucks as some motor vehicle manufacturers scaled back production amid uncertainty related to tariffs imposed on motor vehicle exports to the United States, according to the Ottawa-based agency.

GDP and Income and Expenditure Accounts measure the production of goods and services in the Canadian economy as well as the incomes arising from this production and expenditure on the production. GDP represents the unduplicated value of goods and services produced during the reference period and are available for domestic consumption, investment or export.

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