Canada GDP Contracts by 0.2% in Q4

EthereumCraftsman · 2026-02-27T13:40:18+00:00

In Q4 2025, Canada's GDP fell by 0.2% despite a 1.7% annual growth. The decline was mainly due to inventory withdrawals, with mixed results in investments and consumption, and government spending on weapons systems significantly increased.

EthereumCraftsman

2026-02-27 13:40:18

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The Canadian GDP declined by 0.2% in the fourth quarter of 2025, following a rise of 0.6% in the previous period. The contraction was driven by a withdrawal of business inventories, as imports edged up (+0.3%) and exports rose (+1.5%). Increased capital investment was driven by government investment in weapons systems, supported by a substantial 45.9% annual rise in expenditures on these systems. Governments likewise increased investment in engineering structures, with notable contributions to GDP growth for the third consecutive year. Meanwhile, business capital investment edged down 0.1%. By contrast, both household consumption (+0.4%) and government capital investment increased, while inventory accumulation turned into withdrawals. On an annual basis, the Canadian GDP grew by 1.7% in 2025, slowing from the previous year’s pace and marking the weakest growth since 2020.

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