{"id":475594,"date":"2026-05-31T03:38:10","date_gmt":"2026-05-31T03:38:10","guid":{"rendered":"https:\/\/www.newsbeep.com\/ie\/475594\/"},"modified":"2026-05-31T03:38:10","modified_gmt":"2026-05-31T03:38:10","slug":"canada-enters-surprise-technical-recession-amid-tariff-uncertainty","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ie\/475594\/","title":{"rendered":"Canada Enters Surprise Technical Recession Amid Tariff Uncertainty"},"content":{"rendered":"

\"Canada<\/a><\/p>\n

Islam Times – Canada’s economy posted a surprise contraction in the first quarter versus the year before, making it two straight quarters of annualized decline – which some economists call a technical recession – as the country struggles with US tariff uncertainty.Gross domestic product declined at an annualized rate of 0.1% in the first quarter, Statistics Canada said on Friday, compared with a downwardly revised contraction of 1% in the fourth quarter of last year.<\/p>\n

Analysts polled by Reuters and the Bank of Canada had predicted first-quarter growth of a robust 1.5%. On a quarterly basis, first-quarter GDP was unchanged against a decline in the fourth quarter of last year.<\/p>\n

Canada’s economy has largely \u2060withstood trade uncertainty and tariff impacts for more than a year, but the knock-on effects of tariffs have sapped investments, hiring and expenditure, and driven up prices.<\/p>\n

The upcoming review of the North American free trade deal and the crude price shock due to the Middle East war have added more layers of uncertainty.<\/p>\n

The last two times Canada was in a technical recession were during the start of the pandemic in 2020 and during the oil shock in the beginning of 2015.<\/p>\n

At that time there were two consecutive quarters of decline, both on an annualized basis and quarterly basis, StatsCan said.<\/p>\n

Economists were divided on whether Canada is in a recession or not.<\/p>\n

“The trade-induced contraction in GDP last quarter meant the economy tipped into a technical recession at the start of the year,” said a note from Capital Economics, though rising oil and \u2060gas activity mean the economy likely rebounded in April.<\/p>\n

Randall Bartlett, deputy chief economist with Desjardins Group, said the group is not prepared to call the data a recession as the weakness in the Canadian economy was not widespread.<\/p>\n

The BoC has said growth this year is likely to be at 1.2%, down from 1.7% last year. It will update its projections in July.<\/p>\n

The first-quarter GDP was negatively impacted by a high level \u2060of imports into the country, but that was largely offset by a high accumulation of inventories, the statistics agency said.<\/p>\n

Household spending grew, especially in financial services and food, but this was again mostly canceled out by a decline in business and government investments.<\/p>\n

Business capital investment fell 0.7%, its fifth consecutive quarterly decline, StatsCan said.<\/p>\n

On \u2060a monthly basis, GDP in March declined by 0.1%, against an estimate of flat growth.<\/p>\n

An advance estimate from StatsCan showed that growth in April was likely to be 0.4%, highlighting a strong start to the second quarter.<\/p>\n

Money markets are pricing in a rate hike of 25 basis \u2060points in December, even as most economists have called for no change in interest rates all through the year.<\/p>\n

The Canadian dollar weakened after the GDP data and was trading down 0.28% to C$1.3819 to the US dollar, or 72.36 US cents. Yields on the two-year government bonds slipped further and were down 7.7 basis points at 2.430%. \n <\/p>\n","protected":false},"excerpt":{"rendered":"Islam Times – Canada’s economy posted a surprise contraction in the first quarter versus the year before, making…\n","protected":false},"author":2,"featured_media":475595,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[11],"tags":[37784,32833,205079,11223,44175,72,147881,289,92980,13345,63167,31073,113,163633,9945,61,5493,60,17648,4573,43565,431,205076,31888,205078,1099,38111,4598,33703,37323,41349,1627,39444,331,10103,85990,1633,90,205077,25593,5906,742],"class_list":["post-475594","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy","tag-a","tag-amid","tag-annualized","tag-as","tag-before","tag-business","tag-call","tag-canada","tag-contraction","tag-country","tag-decline","tag-economists","tag-economy","tag-enters","tag-first","tag-ie","tag-in","tag-ireland","tag-islam","tag-it","tag-making","tag-of","tag-posted","tag-quarter","tag-quarters","tag-recession","tag-s","tag-some","tag-straight","tag-struggles","tag-surprise","tag-tariff","tag-technical","tag-the","tag-times","tag-two","tag-uncertainty","tag-us","tag-versus","tag-which","tag-with","tag-year"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/475594","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/comments?post=475594"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/posts\/475594\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media\/475595"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/media?parent=475594"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/categories?post=475594"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ie\/wp-json\/wp\/v2\/tags?post=475594"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}