The Canadian economy posted a strong performance in May after real Gross Domestic Product (GDP) grew by 0.3%, beating the official preliminary estimate of 0.1%. According to Statistics Canada (StatCan), this growth was driven by excellent performance in both the goods and services sectors.
The mining, quarrying, and oil and gas extraction sectors were the main drivers of economic growth for the second consecutive month with an increase of 1%. This performance was supported by oil sands extraction activities that rebounded following the early completion of spring maintenance work.
The real estate subsector also recorded a sharp recovery with real estate broker and agent activity surging 5.1%, the highest monthly jump since October 2024. This recovery was influenced by the spring housing market in major provinces such as Ontario and British Columbia.
In addition, StatCan revised April's GDP from 0.5% to 0.6%, while the preliminary estimate for June is forecast to increase by 0.2%. Consistent performance throughout the quarter is expected to push second-quarter GDP growth to 3.4% on an annualized basis, rebounding from the contraction in the first quarter.
The 3.4% GDP growth forecast is expected to beat the Bank of Canada's original target of 2.5%. The full official second-quarter GDP report is due to be released by the statistical agency in late August.
