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OTTAWA, July 31 (Reuters) – Canada’s economy grew by a greater-than-expected 0.3% in May, pushed up in part by strength in the mining, quarrying and oil and gas sector, official data indicated on Friday.
Economists polled by Reuters had expected the economy to expand by 0.2% in May. It revised April’s growth up to 0.6% from 0.5%, the highest month-on-month gain since July 2025.
Statistics Canada said goods-producing industries expanded 0.6% while services-producing industries posted a 0.2% gain.
The mining, quarrying, and oil and gas extraction sector expanded 1.0% in May. The oil and gas extraction subsector rose 0.7% in May, due to higher oil sands extraction.
In a flash estimate, Statscan said June GDP looked to have increased by 0.2%.
This indicates annualized second quarter growth of 3.4%, significantly higher than the Bank of Canada’s July 15 forecast of 2.5%, and the highest annualized quarterly increase since the 4.3% seen in the first three months of 2023.
The central bank left its benchmark overnight rate unchanged at 2.25% on July 15 and said growth would strengthen in the second half of the year as inflation pressures eased and firms continued to adapt to U.S. tariffs.
Money markets are pricing in a hold on rates for the rest of the year.
(Reporting by David Ljunggren, editing by Dale Smith)
