Canada’s economy grew 1.7% in 2025, the slowest pace of annual growth since the Covid-19 pandemic struck in 2020.
Statistics Canada said lower exports, particularly to the neighbouring U.S., were the main contributor to the slower pace of growth in gross domestic product (GDP) during 2025.
Canada’s GDP declined 0.2% in the fourth quarter of 2025, after rising 0.6% in the third quarter of last year.
The fourth-quarter 2025 decrease was due largely to withdrawals of business inventories following accumulations in the third quarter.
Offsetting some of the Q4 decline were increases in household spending and government capital investment.
Canada’s exports rose 1.5% in the fourth quarter, after increasing 0.9% in the third quarter. The growth in the fourth quarter was led by higher exports of gold and aluminum.
Despite the Q4 bump, Canada’s exports declined 1.7% in 2025 as shipments to the U.S. steadily fell throughout the year.
Imports into Canada rose 0.3% in the fourth quarter due to higher imports of computers, clothing and footwear. For all of last year, imports decreased 0.4%.
Compensation of Canadian employees rose 0.5% in the fourth quarter of last year, following a 1% increase in the third quarter.
The household savings rate stood at 4.4% in the fourth quarter, down from 5.2% in the previous quarter as growth in disposable income lagged spending.
