Canada's economy rebounded in April, posting a 0.5% month-on-month increase in real gross domestic product, Statistics Canada said. The April result marked the largest monthly expansion in nine months and followed a 0.1% contraction in March.
The outturn exceeded a Reuters poll of economists, who had expected a 0.4% monthly gain for April. The rebound offers some relief to concerns that a tariff-driven slowdown was becoming more entrenched.
Sectoral performance
StatsCan reported that 14 of the 20 industrial sectors expanded in April. The goods-producing sector - which contributes up to a quarter of the overall economy - posted a 1.2% increase for the month. Within that grouping, the mining, quarrying, and oil and gas extraction subsector rose 2.9% in April, its largest monthly increase in more than two years.
Construction recorded a 0.7% rise, its first monthly increase in five months. Manufacturing also grew, registering a 0.6% gain in April.
Service-producing industries, which represent roughly three-quarters of GDP and include real estate, transportation and warehousing, and wholesale trade, expanded by 0.3% in April. Transportation and warehousing specifically rose 0.9% for the month, marking the second increase in three months.
Policy and outlook
Canada entered a technical recession at the end of the fourth quarter, but the Bank of Canada and most economists have treated that episode as an isolated event rather than the start of a longer downturn. The economy has faced a range of U.S. tariffs on some key sectors since last year, but the effects to date have been largely confined to those targeted areas.
Nonetheless, uncertainty tied to tariffs and the future of the U.S.-Mexico-Canada free trade agreement - which was scheduled for a review on Wednesday - has restrained investment and job creation, according to Statistics Canada.
Looking ahead, StatsCan's advance estimate for May indicated the economy was likely to expand by 0.1% on a monthly basis.
Summary of key figures
- April month-on-month GDP: +0.5%
- March month-on-month GDP: -0.1%
- Economists' Reuters poll median for April: +0.4%
- Goods-producing sector (share of economy): up to a quarter; April change: +1.2%
- Mining, quarrying, oil and gas extraction: +2.9% (largest monthly rise in more than two years)
- Construction: +0.7% (first rise in five months)
- Manufacturing: +0.6%
- Services-producing industries (share of GDP): roughly three-quarters; April change: +0.3%
- Transportation and warehousing: +0.9% (second rise in three months)
- Industrial sectors expanding in April: 14 of 20
- Advance estimate for May: +0.1% month-on-month