National Bank Notes Quebec's Provincial GDP Continues to Decline

11:48 AM EST, 02/24/2026 (MT Newswires) -- Quebec's gross domestic product in November fell 0.3% month over month, marking the second consecutive monthly decline and the eighth contraction in the last 10 months, said National Bank of Canada.

The performance of the Quebec economy also contrasts with that of the country as a whole, as Canadian GDP remained relatively stable in November, noted the bank.

It pointed out the decline in November was due to a contraction in both the service and goods sectors for the second consecutive month.

In the service sector, the poor performance in November was due in particular to further significant declines in wholesale trade and professional, scientific, and technical services, with activity in these two sectors reaching its lowest level since February 2023.

On the positive side for services, retail trade rebounded significantly by 0.7% during the month, almost entirely offsetting the 0.7% decline recorded in October.

On the goods side, there is no doubt trade tensions with the United States continue to weigh on activity, the bank said. Indeed, the manufacturing sector experienced its eighth monthly decline since the beginning of 2025, with activity at its lowest level since October 2016, excluding the Covid-19 pandemic.

The weakness is also palpable in the agriculture and forestry industry, where new U.S. tariffs on forestry products came into effect in mid-October. Production in the agriculture and forestry sector experienced its sixth consecutive monthly decline, reaching its lowest level since March 2024.

On the positive side, however, there was a significant increase in the public services sector, probably due to the early arrival of winter temperatures. As a result, production in this sector reached its highest level since February 2025 but remains 7.7% below its most recent peak.

While tariff uncertainty undoubtedly weighed on several sectors of the Quebec economy in 2025, it is reassuring to see that the labor market held up and that employment even rebounded strongly in December and January, added the bank.

However, the sustainability of this upturn will depend on an easing of trade tensions with the U.S. and a smooth renewal of the USMCA trade deal in the coming months, according to National Bank.

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