September 03, 2025
Canada's real gross domestic product declined 0.4% in the second quarter of 2025
Statistics Canada announced that Canada's real gross domestic product (GDP) declined 0.4% in the second quarter of 2025, following a 0.5% gain in the first quarter.
The contraction in the second quarter was driven by significant declines in the export of goods, as well as decreased business investment in machinery and equipment.
These declines were tempered by faster accumulations of business inventories, higher household spending and lower imports of goods.
Exports declined 7.5% in the second quarter of 2025 after increasing 1.4% in the first quarter. As a consequence of United States-imposed tariffs, international exports of passenger cars and light trucks plummeted 24.7% in the second quarter. Exports of industrial machinery, equipment and parts (-18.5%) and travel services (-11.1%) also declined.
Amid the counter-tariff response by the Canadian government for imports from the United States, international imports declined 1.3% in the second quarter, after rising 0.9% in the previous quarter. Lower imports of passenger vehicles (-9.2%) and travel services (-8.5%; Canadians travelling abroad) were moderated by higher imports of intermediate metal products (+35.8%), more specifically, by unwrought gold, silver, and platinum group metals.