Canada’s Economy Stalls in July, August Growth Expected to Remain Flat

Canada's economy remains flat in July as trade tensions and sectoral shifts weigh on growth. August estimates show minimal expansion.

Editorial Desk

September 29, 2026 One Min Read

POLICY WIRE — Ottawa, Canada — Canada’s real gross domestic product remained unchanged in July, marking a pause in the country’s recent upward trend after three months of steady expansion. The data signals a potential slowdown in the third quarter, following a strong rebound in the second quarter.

Construction and utilities saw gains of 1.3% and 1.7%, respectively, but these were offset by declines in manufacturing, mining, and oil and gas extraction. Retail and wholesale trade also experienced contractions, contributing to the stagnation in economic activity.

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Only 10 out of 20 subsectors expanded in July, with real estate, rental, and leasing continuing its sixth consecutive month of growth. Flash estimates suggest the economy may see a modest 0.2% increase in August, driven by mining and retail trade, though this comes amid heightened trade tensions with the United States. Economists anticipate slower growth in the third quarter due to ongoing uncertainties.

Reporting by Policy-Wire (PW)

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