Real gross domestic product (GDP) edged down 0.1% in May for the second consecutive month, as goods-producing industries declined while services-producing industries were essentially unchanged, reported Statistics Canada on Thursday.
“The retail trade sector contracted 1.2% in May, as activity in 7 of 12 subsectors decreased,” said the federal agency.
“Motor vehicle and parts dealers (-4.8%) contributed the most to the monthly decline, reflecting lower activity for new and used car dealers and partially offsetting the increases recorded in the previous two months. The subsector was on an upward trend during most of the second half of 2024. Despite posting its third decline in five months in 2025, the activity in May 2025 was 7.8% above the June 2024 level.
“Food and beverage stores (-2.5%) and gasoline stations (-3.1%) further contributed to the decline in retailing activity in May.”
The goods-producing industries edged down in May, driven primarily by a contraction in the mining, quarrying and oil and gas extraction sector, while the manufacturing sector expanded in the month. The services-producing industries were essentially unchanged, as real estate, rental and leasing and transportation and warehousing posted increases while retail trade and public administration contracted. Overall, 7 of 20 industrial sectors expanded in May, explained Statistics Canada.
“Advance information indicates that real GDP increased 0.1% in June. Increases in retail trade and wholesale trade were partially offset by a decrease in manufacturing. Owing to its preliminary nature, this estimate will be updated on August 29, 2025, with the release of the official GDP by industry data for June,” said the federal agency.
“With this advance estimate for June, information on real GDP by industry suggests that the economy was essentially unchanged in the second quarter of 2025. The official estimate for the second quarter will be available on August 29, 2025, when the official estimate of GDP by income and expenditure is released.”
Statistics Canada recently reported that retail sales decreased 1.1% to $69.2 billion in May. Sales were down in three of nine subsectors and were led by decreases at motor vehicle and parts dealers, reported Statistics Canada on Thursday.
Core retail sales—which exclude gasoline stations and fuel vendors and motor vehicle and parts dealers—were relatively unchanged in May. In volume terms, retail sales decreased 1.4% in May, noted the federal agency.
“Feedback from respondents for May highlighted the effects of trade tensions between Canada and the United States on Canadian retail businesses. Supplementary questions asked to respondents show that 32% of retail businesses were impacted by the trade tensions in May, compared with 36% in April. The most common impacts in May were price increases, change in demand for product and increased expenses for raw materials, shipping or labour,” said Statistics Canada.
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