Canada’s GDP saw 0% growth in latest report, StatCan says

The economy stalled in November 2025 as gross domestic product (GDP) was measured at zero per cent following a 0.3 per cent drop in October, according to Statistics Canada.

Gains were seen in services sectors, which offset declines in goods production — including manufacturing.

Statistics Canada says the manufacturing sector as a whole fell by 1.3 per cent, especially in the production of durable goods, which fell by 1.9 per cent. This included the manufacturing of transportation equipment, machinery, fabricated metal products and motor vehicles and parts.

The agency adds that the durable goods sector as a whole declined in November to levels not seen since the middle of 2011, excluding the first half of 2020 amid the COVID-19 pandemic.

U.S. President Donald Trump’s tariff policies have been impacting Canada’s economy, particularly in manufacturing, which is seeing some of the steepest duties on Canadian imports to the U.S., including Canadian-made steel and aluminum products, lumber, and automobiles and parts.

Trump also threatened Canada’s aviation manufacturing sector with additional tariffs if certain certification demands for some U.S. aircraft weren’t met.

Although it isn’t clear how these new tariff threats may unfold, the uncertainty of the ongoing trade war amid multiple threats of tariffs from the Trump administration has led many Canadian businesses to take a wait-and-see approach to expansion and hiring plans.

“The Canadian economy ended the year without any momentum to launch it into 2026. November GDP suggests the trade war showed accelerated weakness in the manufacturing sector with little rebound in December,” Andrew DiCapua, principal economist for the Canadian Chamber of Commerce, said in a written note.

“With recent export weakness in manufacturing, it is likely this story isn’t over. While today’s GDP report was mixed, overall growth in the fourth quarter now appears likely to come in below both the Bank of Canada’s latest forecast and our BDL [Business Data Lab] nowcast.”

There were gains seen in service sectors, which helped offset the declines in goods production, with the retail trade sector expanding 1.3 per cent in November following back-to-back monthly declines in September and October.

Statistics Canada notes that several of the service subsectors saw growth when compared with recent declines because of work stoppages.

Food and beverage retailers saw a boost of 2.5 per cent, which the agency says was mainly from higher sales of beer, wine and liquor following labour action in British Columbia.

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Educational services were up one per cent in November, especially in elementary and secondary schools. Statistics Canada says that was largely because of the resumption of classes in Alberta following the end of the teachers’ strike on Oct. 29.

Transportation and warehousing climbed 0.9 per cent in November, which included postal services rising sharply by 41.7 per cent after job actions that prevented some mail and parcel delivery were suspended on Nov. 21.

Canada Post and the Canadian Union of Postal Workers formed an agreement in principle after more than two years of negotiations and on-and-off job action.

“Canada’s economy limped into year-end. Reading why it did so is a convoluted mess of macro drivers, weather, and strikes,” Derek Holt, head of capital markets economics at the Bank of Nova Scotia, said in a written note.

“It’s unclear if the numbers would mildly surprise the BoC [Bank of Canada] which has strongly signalled it’s looking through what was and toward what may be on the bias that expects something better in 2026.”

The Bank of Canada held its key policy rate at 2.25 per cent on Wednesday, which means no changes to borrowing costs for now. Governor Tiff Macklem at the central bank spoke about the economic outlook for Canada, and said the bank expects modest growth to end 2025 and through 2026.

The final GDP report for December 2025 is scheduled to be released on Feb. 27, and Statistics Canada said on Friday it expects that report to show growth of 0.1 per cent, based on preliminary data.