April 1, 2026

Real gross domestic product (GDP) edged up 0.1% in January, following 0.2% growth in December, driven by strength in goods-producing industries.

Chart 1
Real gross domestic product edges up in January

In January, goods-producing industries expanded by 0.2% for the second month in a row, as gains in mining, quarrying, and oil and gas extraction, construction and utilities more than offset a contraction in manufacturing. Meanwhile, services-producing industries were essentially unchanged in January, as increases in retail trade and finance and insurance were offset by declines in wholesale trade and transportation and warehousing. Overall, 9 of the 20 industrial sectors recorded growth in January.

Mining, quarrying, and oil and gas extraction rebounds, driven by growth in oil and gas extraction

Mining, quarrying, and oil and gas extraction expanded by 1.2% in January, fully offsetting December’s decline, led by increased activity in oil and gas extraction.

Chart 2
Mining, quarrying, and oil and gas extraction sector rebounds in January

Oil and gas extraction (+1.6%) more than offset December’s contraction (-1.0%), with widespread increases in January across all industries. Growth of 2.8% in oil and gas extraction (except oil sands) reflected increased crude petroleum extraction in Newfoundland and Labrador and Saskatchewan, as well as increased overall natural gas extraction. Oil sands extraction (+0.2%) further added to the growth.

Mining and quarrying (except oil and gas) rose 0.4% in January, partially offsetting December’s contraction. Coal mining (+4.1%) led the subsector’s growth, coinciding with higher exports of coal. Non-metallic mineral mining and quarrying rose 1.7%, following back-to-back monthly declines in November and December, as most activities grew in January, led by a 2.6% rise in potash mining.

Manufacturing sector pulls back in January after leading December’s expansion

The manufacturing sector contracted 1.4% in January, more than offsetting December’s increase, on weaknesses in durable-goods and non-durable-goods manufacturing industries.

Chart 3
Manufacturing sector contracts in January

Durable-goods manufacturing industries, down for the third time in four months, decreased 2.0% in January, driven by contractions in transportation equipment manufacturing (-6.0%) and machinery manufacturing (-5.6%).

In January, motor vehicles and parts manufacturing (-10.8%) recorded its largest contraction since September 2021, on weaknesses in motor vehicle manufacturing (-23.5%) and motor vehicle parts manufacturing (-4.5%). Winter shutdowns at automotive assembly plants in Ontario, that typically tend to occur around the holidays, extended into January. The retooling and maintenance related work hampered production and exports of motor vehicles in January. Further contributing to the decline was a contraction in machinery manufacturing, mainly concentrated in the industrial machinery manufacturing and agricultural, construction and mining machinery manufacturing industry groups.

Wholesale trade down for third time in four months

The wholesale trade sector fell 1.2% in January, largely offsetting December’s increase, with motor vehicle and motor vehicle parts and accessories merchant wholesalers leading the contraction.

Motor vehicle and motor vehicle parts and accessories merchant wholesalers (-5.1%) drove the decline in January, after leading the sector’s expansion in the prior month, reflecting a sharp fall in exports of passenger cars and light trucks and reduced auto production in January as a result of prolonged seasonal production stoppages in several auto plants for retooling and maintenance.

Following three consecutive monthly contractions, a rebound in building material and supplies merchant wholesalers (+1.3%) tempered the decline in the sector, reflecting increased activity in the construction sector.

Construction maintains an upward trajectory, up for a third consecutive month

The construction sector expanded 1.1% in January, on widespread increases across all subsectors.

Chart 4
Construction peaks in January

Engineering and other construction activities, up for a second month in a row, led the growth in January (+1.1%), followed by repair construction (+1.8%).

Expansion in residential building construction, recording its third consecutive monthly growth, further added to the increase in January, up 0.8% in the month, driven by increased investment in residential alterations and improvements as well as expansion in multi-unit dwellings construction. Non-residential building construction was up for a seventh consecutive month, increasing 1.1% in January, reflecting increased construction of institutional and commercial buildings.

Retail trade grows in January

The retail trade sector expanded 0.8% as six of its nine subsectors were up in January.

General merchandise retailers (+3.0%) led the growth in January. Motor vehicle and parts dealers (+2.4%) was another large contributor to the increase, reflecting higher retailing activity at new car dealers.

Finance and insurance sector grows on record foreign acquisitions of Canadian bonds

Finance and insurance grew 0.5% in January, marking its largest increase since September 2025.

A rebound in the other finance and insurance subsector (+1.2%) contributed the most to the increase in January. Higher-than-usual trading activity in both equity and fixed-income markets fuelled growth, with record foreign investment in Canadian bonds driving the gains in activity in January.

Extreme weather conditions weigh on transportation and warehousing in January

Transportation and warehousing decreased 0.7% in January, following back-to-back monthly increases in November and December, with most subsectors recording declines in January.

Contraction in transit, ground passenger and scenic and sightseeing transportation (-1.4%) contributed the most to the decline in January, driven by a 2.6% decrease in urban transit systems. Severe winter storms and snowfalls in late January disrupted transit operations. Air transportation (-0.5%) was another contributor to the decline, as the winter storms at Canada’s busiest airports caused many flight cancellations.

Support activities for transportation (-0.7%) and truck transportation (-0.4%) were down in January, negatively impacted by prolonged shutdowns at the automotive assembly plants.

Pipeline transportation (-1.7%) further added to the decline in January, driven by contractions in crude oil and other pipeline transportation (-2.2%) and pipeline transportation of natural gas (-1.2%).

Real estate and rental and leasing posts its first decline in 10 months

Real estate and rental and leasing contracted 0.2% in January, the first decline for the sector since March 2025.

Lower activity at the offices of real estate agents and brokers and activities related to real estate (-6.1%) contributed the most to the decline in January. It was the largest decrease since February 2025, reflecting falling national home resales in January across all provinces, especially in Ontario and British Columbia.

Legal services, which derives much of its operations from real estate transactions, contracted 1.1% in January, marking its strongest decline since March 2025.

Chart 5
Main industrial sectors’ contribution to the percent change in gross domestic product in January

Advance estimate for real gross domestic product by industry for February 2026

Advance information indicates that real GDP increased 0.2% in February. Increases in manufacturing, in the mining, quarrying and support services subsector and in finance and insurance were partially offset by decreases in agriculture, forestry, fishing and hunting. Owing to its preliminary nature, this estimate will be updated on April 30, 2026, with the release of the official GDP by industry data for February.

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