Carney Warns Canada's Economy Still Lags Behind

Canada's economy grew by 3.3% on an annualized basis in the second quarter of this year, its best performance since 2023 and highest in the G7.

Statistics Canada reported that the economy contracted by 1% in the fourth quarter of 2025, but revised an earlier finding that it had contracted by 0.1% in the first quarter to a 0.3% increase.

This means Canada did not experience a technical recession after all.

However, Prime Minister Mark Carney warned that one positive snapshot does not tell us the whole story and that the economy was weak before the collapse of trade negotiations with the U.S.