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Canada’s exports in April fell to $60.44 billion (March: $67.76 billion), while imports decreased to $67.58 billion (March: $70.01 billion). As a result, the trade deficit widened to $7.14 billion in April (March: $2.26 billion), reflecting weaker export performance despite lower import volumes.

Canada’s Q1 labor productivity increased by 0.2% quarter-on-quarter (forecast: 0.2%; Q4: 0.6%), reflecting a significant slowdown from the previous quarter’s gains.

The Bank of Canada kept interest rates unchanged at 2.75%, as widely expected. In the post-meeting press conference, Governor Tiff Macklem struck a cautious tone, stating, "Uncertainty remains high. The Canadian economy is softening but not sharply weakening—and we’re seeing some firming in recent inflation data."

He also acknowledged, "The trade conflict initiated by the United States remains the biggest headwind for Canada’s economy."

S&P Global’s Manufacturing PMI for May rose to 46.1 from April’s 45.3, remaining below the 50 threshold and signalling that factory activity is still contracting, albeit at a slower pace.

Average weekly earnings rose 4.31% YoY in March, down from February’s 5.14%, signaling cooling wage growth. Canada’s Q1 current account deficit narrowed to C$2.1 bn, compared with forecasts for a C$3.4 bn shortfall and an actual C$3.6 bn deficit in Q4, reflecting a stronger external position.

Statistics Canada reports wholesale sales fell 0.9% month-on-month in April, reversing March’s 0.2% gain and highlighting cooling activity in the distribution sector.

The New Housing Price Index fell 0.4% month-on-month in April, reversing a 0.1% rise in March and following no change in February, signaling a cooling of new home price growth.

Statistics Canada data show that headline CPI declined 0.1% month-on-month in April, matching forecasts, and rose 1.7% year-on-year, above the 1.6% consensus but down from March’s 2.3%. Core CPI, which excludes food and energy, climbed 0.5% MoM (forecast 0.2%; previous 0.1%) and 2.5% YoY (previous 2.2%), pointing to entrenched underlying inflation. The Common CPI also rose 2.5% YoY. Meanwhile, median CPI accelerated to 3.2% YoY (forecast 2.9%; previous 2.8%) and trimmed CPI to 3.1% YoY (forecast 2.8%; previous 2.9%), underscoring broad-based price pressures.

On May 15, 2025, Statistics Canada reported that manufacturing sales fell by 1.4% month-on-month in March, a smaller decline than the 1.8% drop forecast but deeper than February’s 0.2% fall. In contrast, wholesale sales rose by 0.2% over the same period, beating expectations for a 0.4% decline but slowing from February’s 1.0% gain. The mixed figures point to ongoing weakness in factory activity even as distribution channels show modest resilience.

On May 15, 2025, Statistics Canada reported that housing starts jumped to 278,600 units in April, well above the forecast of 227,000 and up from March’s 214,200. The strong gain highlights robust momentum in the country’s residential construction sector.

Canada’s trade deficit narrowed to CAD 0.51 billion in March, improving from CAD 1.41 billion in February and beating expectations of CAD 1.70 billion. Exports held steady at CAD 69.90 billion, while imports declined to CAD 70.40 billion from the previous month, signaling a modest rebound in Canada’s external trade balance.

Canada’s S&P Global Manufacturing PMI fell to 45.3 in April from 46.3 in March, marking the lowest level since May 2020. The continued drop signals deeper contraction in the manufacturing sector amid weak demand, rising costs, and broader economic uncertainty. This persistent softness may reinforce calls for more accommodative policy from the Bank of Canada.