Conference Board Sees Canada's Economic Growth Limited at 1.5% This Year as U.S. Trade War Causes Uncertainty

10:08 AM EDT, 07/07/2025 (MT Newswires) -- The Canadian economy is set to face further headwinds as uncertainty surrounding United States trade policies continues to weigh on business and consumer confidence, according to new research from the Conference Board of Canada published Monday.

Canada's gross domestic product is forecast to increase by 1.5% this year, according to the Conference Board.

"The economy outperformed expectations in the first quarter of 2025, but the momentum is quickly fading," said Cory Renner, Associate Director, Economic Forecasting at the Conference Board of Canada, in a statement. "Trade disputes are casting shadows over multiple sectors of the economy and are expected to dampen growth throughout the remainder of the year."

Canada's housing market remains under "intense pressure," it added. Looking ahead, a projected quarter-point interest rate cut in the latter half of the year will provide some additional relief.

Given the trade conflict with the U.S., Canada's trade sector is in for a "rough ride," stated the Conference Board. While Canadian exporters have turned to new markets with some success, these gains are insufficient to offset the sharp decline in exports from our largest trading partner. Import growth will also be held back as Canadians and businesses rein in spending.

Business investment is expected to suffer, with concerns over the Canada-U.S. trade relationship keeping spending subdued, according to the Conference Board.

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