Canadian real GDP grew by 0.5 per cent in April after decreasing by 0.1 per cent in March. Goods-producing sectors rose by 1.2 per cent, while service-producing industries rose by 0.3 per cent from the previous month. Industry contributors to growth were led by mining, quarrying, and oil and gas extraction (2.9 per cent), transportation and warehousing (0.9 per cent), and construction (0.7 per cent). Output for the offices of real-estate agents and brokers rose by 1.3 per cent month-over-month. Preliminary estimates suggest that real GDP by industry increased by 0.1 per cent in May.

April’s rebound in Canadian GDP was an encouraging sign of a growing economy following two consecutive quarters of contraction. Growth was fairly broad-based, with 14 out of 20 sectors expanding from the previous month. Taken together, this print marks the largest monthly increase in GDP by industry since July 2025, which, paired with a positive preliminary estimate for May, is setting the Canadian economy up for a solid rebound in the second quarter of 2026. Despite the strength of this report, it is unlikely to sway the Bank of Canada off its course. We expect the policy rate to remain at 2.25 per cent through 2026 as the Bank continues looking through the double-sided risks facing the economy in favor of anchoring expectations at current levels.