Canada's Economy Flatlines in July Despite Construction and Utilities Gains

Canada's economy experienced flat growth in July despite gains in construction and utilities sectors. According to Statistics Canada, gross domestic product (GDP) growth was essentially unchanged from June to July.

The construction sector saw a 1.3% gain in July, its fourth consecutive month of growth after declines in late 2025 and early 2026. Non-residential building construction had its best month since the start of 2022 due to activity around a new hospital building in Toronto.

Meanwhile, the utilities sector saw a 1.7% surge in electricity generation, transmission, and distribution, driven by a July heat wave that increased power demands for cooling.

However, manufacturing declined by 0.9%, marking its first drop in four months. Mining and quarrying also took a sharp hit in July, with a 6.4% drop in potash mining being the largest monthly decline since September 2025. Oil and gas extraction saw an increase in oil sands extraction but overall declined.

StatCan revised their initial estimates, showing GDP was actually up 0.4% in June compared to earlier estimates of 0.3%. The agency projected a gain of 0.2% in August, which will partially capture the impact of new 50% U.S. tariffs applied on Canadian goods starting Aug. 22.