Canada’s GDP is expected to have grown by 0.3% in September 2024, showing positive momentum after a flat performance in August. Economic activity was notably bolstered by gains in finance, insurance, construction, and retail trade, helping offset weaknesses in areas such as mining and oil and gas. The September estimate suggests the Canadian economy is gradually regaining its footing despite ongoing sectoral challenges.

August Economic Performance Reflects Market Expectations

In August, Canada’s economy showed no overall growth, aligning with preliminary forecasts. This period of stagnation highlights ongoing economic headwinds, particularly within the goods-producing sector. While services-producing industries inched up 0.1%, driven by finance, insurance, and public administration, goods-producing industries fell by 0.4%—their lowest level since December 2021. This decline underlined the mixed performance across Canada’s major industries.

Goods-Producing Sectors Face Declines

Manufacturing, a key component of Canada’s economy, experienced a 1.2% decline in August, with reductions across both durable and non-durable goods. Transportation and warehousing also contracted by 0.3%, impacted by rail disruptions, while utilities fell by 1.9% after three months of growth. On the positive side, mining, quarrying, and oil and gas extraction saw a slight increase of 0.6%, showing some resilience within the sector despite broader weaknesses.

Financial Sector Leads Growth Amid Market Volatility

The finance and insurance sector rose by 0.5% in August, fueled by higher trading activity during periods of market volatility. This growth highlights the sector’s role in stabilizing overall economic performance. By the end of August, 12 of 20 sectors had shown expansion, underscoring the diverse drivers behind Canada’s economic resilience. As the country heads into the final quarter of 2024, continued monitoring of these sectors will be crucial to understanding overall economic health and growth potential.