Canada’s economy closed 2025 on a slightly firmer note, with GDP rising 0.2% mom in December, above expectations of 0.1%. The expansion was driven by gains in both services-producing and goods-producing industries, suggesting a modest rebound in activity toward year-end.
Services industries led the monthly increase, rising 0.2%, supported by wholesale trade, the public sector, and transportation and warehousing. Meanwhile, goods-producing sectors also expanded 0.2%, partially reversing back-to-back declines in October and November, with manufacturing and utilities contributing to the recovery. In total, 11 of 20 industrial sectors recorded growth in December.
Advance estimates suggest real GDP was essentially unchanged in January, pointing to a fragile start to 2026.
The quarterly picture was less encouraging. GDP by industry edged down -0.1% in Q4 following a solid 0.6% expansion in Q3. Manufacturing was the main drag, contracting -1.5% in the quarter—its third decline of 2025 and fourth in the past five quarters—highlighting persistent weakness in the sector.
