National Bank Sees Quebec Provincial GDP Posting "Modest" Growth at End 2025 After October's Contraction

10:30 AM EST, 01/27/2026 (MT Newswires) -- Quebec's provincial gross domestic product in October fell 0.4% compared with September, the first decline in four months and similar to that observed across the country, said National Bank of Canada.

It should be noted that the decline in October was due to a contraction in both the service and goods sectors, pointed out the bank.

For services, this is the first decline in four months due to a sharp drop in retail and wholesale sales activity, as well as education services, which experienced their sharpest monthly decline since the strike in the education sector in December 2023. The transportation sector also experienced a notable decline, likely driven down by the October implementation of new United States tariffs on forest products and certain furniture.

The goods sector also felt the effects, continuing to be particularly volatile as it alternated between decline and growth for the fifth consecutive month. The decline in the goods sector is unsurprisingly explained by a fifth consecutive monthly contraction in the agriculture and forestry subsector, but also by a sharp decline in the manufacturing sector due to new U.S. tariffs.

Indeed, the manufacture of wood products declined sharply during the month, as did the production of paper and furniture, noted National Bank.

Looking ahead, "encouraging" signs in the labor market suggest that Quebec's economy could return to modest growth by the end of 2025, although hampered by weak demographics, according to the bank.

In addition, the Bank of Canada's interest rate cuts in the fall will help support the province's economy and its particularly "robust" real estate market, added National Bank.

MT Newswires does not provide investment advice. Unauthorized reproduction is strictly prohibited.