Canada's Economy Stalls Despite Construction and Utilities Gains

The Canadian economy showed no growth in July despite gains in construction and utilities sectors.

The country's gross domestic product (GDP) was essentially unchanged in July, marking a slowdown from the strong second quarter. This comes after Statistics Canada reported that the construction sector experienced its fourth consecutive month of growth with a 1.3% gain in July.

This increase was largely driven by non-residential building construction, which saw its best month since the start of 2022 due to activity around a new hospital building in Toronto. The utilities sector also experienced significant growth with a 1.7% surge in electricity generation, transmission and distribution, primarily due to the heat wave that drove up power demands for cooling.

However, not all sectors fared well. Manufacturing declined by 0.9%, marking its first drop in four months, while mining and quarrying took a sharp hit with a 6.4% drop in potash mining, the largest monthly decline since September 2025. Additionally, retail activity fell at gas stations due to rapidly rising gasoline prices during peak summer travel.