Real gross domestic product (GDP) was down 0.2% in February, partly offsetting January’s 0.4% increase.
After driving growth in January, goods-producing industries (-0.6%) drove the decline in February, as mining, quarrying, and oil and gas extraction and construction contributed the most to the aggregate’s decline.
Services-producing industries edged down 0.1% in February as contractions in transportation and warehousing and real estate and rental and leasing were partially offset by a rise in finance and insurance. Overall, 12 of 20 industrial sectors declined in February.
Mining, quarrying, and oil and gas extraction sector contracts after strong January
Following two consecutive monthly increases, the mining, quarrying, and oil and gas extraction sector became the largest detractor from growth, down 2.5% in February, as most subsectors contracted.
Oil and gas extraction contracted 2.8% in February, fully offsetting January’s 2.6% expansion. February’s decline was a result of broad-based declines across subsectors.
Oil sands extraction contributed the most to the decline with a 3.8% contraction in February. Lower crude bitumen extraction and synthetic crude production resulted in the largest monthly contraction in the industry since January 2024.
Oil and gas extraction (except oil sands) decreased 1.8% in February because of lower crude petroleum extraction as well as lower natural gas extraction. Crude petroleum extraction contributed the most to the decline, impacted by lower light and heavy crude extraction in Alberta as well as lower offshore production in Newfoundland and Labrador. Harsh weather in the North Atlantic ocean and a collision between an oil tanker and a transhipment terminal in Newfoundland and Labrador curtailed production in February.
Mining and quarrying (except oil and gas) declined 2.6% in February, more than offsetting the increases registered in the previous two months. Coal mining (-14.8%) contributed the most to the decline, recording its largest monthly contraction since March 2022, and coinciding with reduced exports to Asian markets. Metal ore mining (-2.5%) continued to decrease in February 2025, impacted by the second consecutive monthly declines in copper, nickel, lead and zinc ore mining (-4.5%), other metal ore mining (-7.7%) and iron ore mining (-2.1%). Meanwhile, broad-based increases in non-metallic mineral mining and quarrying (+2.7%) tempered the decline, buoyed up by a 3.5% rise in potash mining.
Construction down on a broad-based decline in activity
Construction (-0.5%) contracted for the first time in four months as most types of construction activities were down in February.
Residential building construction (-0.9%) contributed the most to the decline in February, recording its largest decrease since April 2024 and reflecting lower home alterations and improvements activity coupled with lower construction of single-family and row houses.
Engineering and other construction activities (-0.6%) and repair construction (-0.8%) also contributed to the decline in the sector, while non-residential building construction (+0.6%) expanded for the seventh consecutive month as both public and industrial building construction rose in February.
Real estate and rental and leasing down for the second time in three months
The real estate and rental and leasing sector contracted 0.4% in February, posting its largest decline since April 2022.
Activity at the offices of real estate agents and brokers and activities related to real estate (-10.4%), down for a third consecutive month, contributed the most to the decline in the real estate sector in February. This third consecutive monthly decline pushed activity down to levels last seen in December 2023 as home resale activity in many markets across the country continued to cool.
The legal services industry, which derives much of its activity from real estate transactions, contracted 1.4% in February, down for the third consecutive month.
Manufacturing up on durable goods manufacturing
The manufacturing sector rose 0.6% in February, up for the second month in a row, in large part driven by durable-goods manufacturing industries in February.
Machinery manufacturing (+5.9%) contributed the most to the increase in the durable goods manufacturing aggregate and posted its highest increase since February 2023. The transportation equipment manufacturing subsector rose 0.7% in February, with motor vehicle parts manufacturing (+4.2%) contributing the most to the increase and coinciding with higher exports of motor vehicle engines and parts. Tempering the growth were declines in primary metal manufacturing (-2.3%), as well as wood product manufacturing (-1.3%), driven by a decrease in sawmills and wood preservation manufacturing and coinciding with a decline in exports of lumber and other sawmill products.
Adverse weather weighs on transportation and warehousing
Transportation and warehousing contracted 1.1% in February, following two consecutive monthly gains. Major snowstorms that hit Central and Eastern Canada and storms passing through British Columbia adversely impacted the sector in February.
Transit, ground passenger, scenic and sightseeing transportation fell 3.4% in February, with urban transit usage falling as poor road conditions in some of Canada’s largest urban centres limited activity for some days in the month.
Rail transportation (-5.6%) declined for the first time in three months in February, as commuter train cancellations, and capacity and speed reductions by rail carriers due to severe winter conditions all contributed to the decrease. February’s decline marked the largest drop since August 2024, when work stoppages at Canada’s two main rail carriers disrupted operations.
Finance and insurance up for the third month in a row
The finance and insurance sector increased 0.7% in February, rising for the third consecutive month. Financial investment services, funds, and other financial vehicles drove the increase with a 2.7% rise in February. Increased financial market activity amid escalating trade tensions drove the increase in the subsector, coinciding with a large divestment of Canadian shares from non-residents in the month.
Banking, monetary authorities and other depository credit intermediation edged up 0.1% in February as increases in demand deposits more than offset the decline in fixed-term deposits at chartered banks. Fixed-term deposits, which had trended upward since the beginning of 2022, began to trend downward in the second half of 2024 in the context of the Bank of Canada’s interest rate cuts that began in June 2024. Meanwhile, activity in demand deposits rose as people reallocated their investments in response to changing interest rates.
Advance estimate for real gross domestic product by industry for March 2025
Advance information indicates that real GDP increased 0.1% in March. Increases in mining, quarrying, and oil and gas extraction, retail trade and transportation and warehousing were partially offset by decreases in manufacturing and wholesale trade. Owing to its preliminary nature, this estimate will be updated on May 30, 2025, with the release of the official GDP by industry data for March.
With this advance estimate for March, information on real GDP by industry suggests that the economy expanded 0.4% in the first quarter of 2025. The official estimate for the first quarter will be available on May 30, 2025, when the official estimate of real GDP by income and expenditure is released.
