FX.co ★ Canada GDP Unexpectedly Stalls

Canadian GDP was flat in the first quarter of 2026, matching the 0.2% contraction recorded in the final quarter of 2025 and falling short of market expectations for a 0.3% expansion. Consumption expenditure edged up by 0.2%, decelerating from the 0.7% increase in the previous period. Within this category, household spending rose by 0.4%, offsetting a 0.2% decline in government expenditure.

Gross fixed capital formation fell by 1.1%, marking its first decline in a year. At the same time, GDP came under notable pressure from a 2.9% increase in imports, driven primarily by higher inflows of gold and scrap metal. Exports slipped by 0.1%, despite a spike in oil and gas prices in March following the outbreak of war in the Middle East.

Much of the imported gold, along with manufactured goods, was directed into inventories, which helped prevent a second consecutive quarterly contraction in Canadian GDP. On an annualized basis, Canada’s GDP edged down by 0.1%.