Canada's Economy Flatlines in July, Rebound Expected in August

Canada's economy stagnated in July, according to Statistics Canada, which reported that real GDP was essentially unchanged. However, an advance estimate suggests a rebound of 0.2 percent in August.

The construction and utilities sectors showed growth, with increases of 1.3 percent and 1.7 percent respectively. On the other hand, manufacturing declined by 0.9 percent, while mining, quarrying, and oil and gas extraction fell by 0.5 percent.

Deloitte Canada's fall economic outlook cut its growth forecast for 2027 to 1.6 percent from an initial projection of 2 percent made in June. The downgrade is attributed to the economy adjusting to US Section 338 tariffs and Canadian retaliation, as well as uncertainty surrounding higher costs, trade friction with the US, and potential interest rate hikes.