Ottawa, Canada / RankWire.AI / – The latest official figures confirm that the Canadian economy experienced a 0.3 per cent growth in May, marking the second month of consecutive expansion and surpassing earlier government projections. According to the monthly Gross Domestic Product data released by Statistics Canada, real output increased in 13 of the 20 major industrial sectors, propelled by widespread improvements in goods-producing industries and steady demand within services. This actual monthly growth outperformed the preliminary estimate of 0.1 per cent growth, fueling positive momentum for the nation’s economic output following a revised growth rate of 0.6 per cent in April.
The expansion was primarily driven by a 1.0 per cent increase in the mining, quarrying, and oil and gas extraction sector, marking its second consecutive month of growth. Increased activity at Alberta’s bitumen sites and postponed routine spring maintenance contributed to higher crude oil extraction volumes throughout May. Support activities related to oil and gas extraction grew by 9.8 per cent, marking their seventh month of expansion in a row. Additionally, the transportation and warehousing sector saw a 0.3 per cent rise, supported by increased pipeline throughput transporting natural gas for export and higher domestic freight activity.
The real estate and rental services sector also played a role in May’s economic growth, with offices of real estate agents and brokers experiencing a 5.1 per cent jump—the largest single-month increase for this subsector since October 2024. Resale housing activity picked up notably in major markets such as Toronto, leading to higher transaction volumes and rental income. Meanwhile, goods-producing industries overall grew by 0.6 per cent, buoyed by strong monthly gains in construction (0.8 per cent), manufacturing (0.7 per cent), and utility production (0.7 per cent).
Canadian Economy Sees 0.3 Per Cent Growth in May as Second Quarter Rebound Picks Up Speed
Industries focused on services registered a 0.2 per cent increase in May, marking the fourth consecutive month of expansion for this sector. The public sector, including education, healthcare, and public administration, expanded by 0.3 per cent. Finance and insurance services also contributed positively, alongside spectator sports, which saw increased attendance and broadcast revenue as Canadian professional hockey teams advanced in playoffs. Overall industrial data indicated a sustained positive trend across both public and private service sectors.
Preliminary guidance from national statistical officials suggests that real GDP grew by an additional 0.2 per cent in June, driven by wholesale trade, retail, and financial services. Combining these figures, economists at CIBC project that second-quarter economic growth on an annualized basis is approximately 3.4 per cent—well above the 2.5 per cent forecast by the Bank of Canada. Senior economist Andrew Grantham pointed out that the robust second-quarter data affirms that the Canadian economy grew 0.3 per cent in May, effectively ending discussions about a broader technical recession.
Energy Sector Growth Driven by Deferred Maintenance on Alberta Bitumen Projects
While the second-quarter acceleration is evident, industry analysts from BMO Financial Group expect growth to slow during the latter half of the year. Chief economist Doug Porter stated that although the May report demonstrates economic resilience amid ongoing uncertainties, factors such as persistent trade tensions and high fuel prices could limit third-quarter expansion. Nonetheless, the positive GDP trend offers significant flexibility for monetary policy decisions, as officials consider interest rate adjustments following the hold at 2.25 per cent earlier this month.
Representatives from the Business Council of Canada emphasized that earlier quarterly contractions reflected short-term volatility rather than a fundamental economic decline. Marc Desormeaux, vice president of policy at the council, highlighted that strong foundational performance in resource extraction and manufacturing continues to support the country’s economic health. As the final official second-quarter GDP figures are set for release at the end of August, financial markets assign a near 97 per cent probability that the Bank of Canada will keep interest rates unchanged at their upcoming September policy meeting.