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Real gross domestic product declined 0.3 per cent in August and early signs suggest the economy barely managed any growth in the third quarter, Statistics Canada said Friday.
Goods-producing industries were down in August for the fifth time this year while the services side contracted for the first time in six months, StatCan said.
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The agency said August’s decline mostly offsets a gain of 0.3 per cent in real GDP for July, which was revised a tick higher from earlier estimates.
StatCan said a work stoppage among Air Canada flight attendants hampered air transportation activity in August. That subsector was down 4.6 per cent in the month, marking its steepest decline since the COVID-19 pandemic.
The wholesale trade industry and the mining and quarrying subsectors posted declines in August as well, offset by growth in retail trade.
The tariff-sensitive manufacturing industry posted a decline of 0.5 per cent in August, but an early look at September’s real GDP figures show the sector might have rebounded last month.
StatCan’s advance estimates for September call for a gain of 0.1 per cent in real GDP, led by increases in manufacturing, finance and insurance, mining, quarrying and oil and gas extraction. The agency expects further losses in wholesale trade and a decline in retail trade were drags on growth last month.
Based on the early estimates, StatCan expects 0.4 per cent annualized growth for the third quarter. That’s a tick below the Bank of Canada’s forecast for the quarter released alongside its quarter-point rate cut earlier this week.
StatCan said the Canadian economy shrank 1.6 per cent on an annualized basis in the second quarter as tariffs from the United States drove a sharp decline in exports.
This report by The Canadian Press was first published Oct. 31, 2025.
