Canada's Economy Was Flat in August, and the Loonie Ended October Firmer

Canada's real gross domestic product was flat in August 2026, Statistics Canada said on Friday, October 30, the second month in a row with no growth. Its advance estimate for September shows a small decline, and on that basis the agency said the economy expanded 0.3 per cent in the third quarter.

The economy is larger than it was a year ago. Real GDP in August was 1.5 per cent above August 2025, according to the agency's industry table, running at an annual rate of about C$2.37 trillion in chained 2017 dollars, the measure Statistics Canada uses to strip price changes out of output.

The Canadian dollar firmed in late October. It was worth 71.63 US cents on October 30, according to the Bank of Canada's daily average rate, up from its lowest level of the year three weeks earlier. Government of Canada bond yields sit well above where they began 2026.

How much did Canada's economy grow in August 2026?

In practical terms, it did not.

Statistics Canada described real GDP as "essentially unchanged" in August, a change that rounds to 0.0 per cent, after a revised flat reading for July. Nine of the 20 industrial sectors expanded.

August came in below the agency's earlier advance figure. On September 29, Statistics Canada's advance information had pointed to growth of 0.2 per cent in August, and the full data published on October 30 replaced that with no change. The October 30 release also revised the monthly series back to January 2025.

Goods and services moved in opposite directions, by small amounts. Goods-producing industries edged up 0.1 per cent and services-producing industries edged down 0.1 per cent, the agency said.

The second-quarter months were stronger. On the revised figures, real GDP rose 0.6 per cent in April, 0.3 per cent in May and 0.4 per cent in June, after a 0.2 per cent decline in March.

Which industries drove the change in August

Retail trade led the gains. The sector rose 1.2 per cent, "more than offsetting the contraction in July," Statistics Canada said, as most of its subsectors expanded. Motor vehicle and parts dealers were up 1.8 per cent.

Manufacturing grew 0.3 per cent. Machinery manufacturing rose 3.8 per cent and petroleum refineries 4.2 per cent, while transportation equipment fell 3.1 per cent as "a prolonged summer shutdown at a major auto assembly plant dampened activity in the industry," in the agency's words.

Transportation and warehousing grew 0.5 per cent. Rail transportation rose 3.6 per cent, its largest monthly gain since March 2025, with wheat shipments contributing the most, the agency said. Finance and insurance added 0.2 per cent, with Statistics Canada linking a 0.2 per cent rise in other finance and insurance to higher mutual fund activity and gold purchases "as investors hedged against policy risks, trade uncertainties and geopolitical tensions."

Wholesale trade was the largest detractor, down 1.4 per cent, with motor vehicle and parts wholesalers down 4.4 per cent. The public sector slipped 0.2 per cent. Within it, federal public administration (except defence) fell 2.1 per cent "as 2026 Census work continued to wind down."

Utilities declined 0.4 per cent. Nuclear generating stations in Ontario and New Brunswick were down for maintenance in August, the agency said.

Mining, quarrying, and oil and gas extraction was flat overall, with two large moves cancelling out. Oil and gas extraction fell 1.2 per cent, led by a 2.1 per cent decline in oil sands extraction as some mining facilities in northern Alberta underwent maintenance, the agency said.

Mining and quarrying excluding oil and gas went the other way, up 4.9 per cent. Potash mining grew 12.0 per cent. Other metal ore mining jumped 56.2 per cent and fully offset its July decline. Extraction and ore processing in northern Saskatchewan resumed after production disruptions, the agency said.

What the September estimate means for the third quarter

The September number is an advance estimate built from early information, and Statistics Canada said it will be updated on November 30, 2026. It shows real GDP down 0.1 per cent, with decreases in manufacturing and in mining and oil and gas extraction partly offset by increases in utilities and wholesale trade.

Combined with flat readings for July and August, that estimate leaves the economy 0.3 per cent larger in the third quarter than in the second, the agency said. Quarterly growth compares average output across three months with the average of the three before, so a quarter that starts from June's higher level can show growth even when its own months are flat or slightly lower. The official third-quarter figure arrives with the November 30 release, alongside the full September data.

The two earlier quarters of 2026 both grew. Real GDP rose 0.8 per cent in the second quarter and 0.1 per cent in the first, as revised, according to the national accounts Statistics Canada published on August 28, 2026. Exports rose 3.6 per cent in the second quarter, the agency said at the time.

Where the Canadian dollar stands

The loonie finished October at its highest daily rate of the month. The Bank of Canada's daily average rate for October 30 was C$1.3960 per US dollar, which is 71.63 US cents per Canadian dollar.

The low point came on October 9, when the US dollar cost C$1.4271, or 70.07 US cents per Canadian dollar. That was the Canadian dollar's lowest daily rate of 2026 in the Bank's series. From there to the end of the month it gained about 2.2 per cent against the US dollar, by Maple's calculation from the two daily rates.

Measured against the start of the year, the loonie is lower. It was worth 72.96 US cents on December 31, 2025, according to the same series, and the October 30 rate is about 1.8 per cent below that year-end level, by Maple's calculation.

Its 2026 high in the series was 73.99 US cents, on January 29.

The Bank publishes these rates once each business day by 16:30 ET. Each is an average of rates observed during the day, not a closing rate.

What Government of Canada bond yields show

Bond yields are the interest rates the federal government pays to borrow, and they change each day with trading in its bonds. On October 29, the latest day in the Bank of Canada's series when the GDP data came out, the two-year benchmark yield was 3.36 per cent and the 10-year was 3.84 per cent.

Both have risen through 2026. The two-year yield was 2.58 per cent on December 31, 2025, so it is up 78 basis points (a basis point is one hundredth of a percentage point).

The 10-year was 3.42 per cent at the end of 2025 and is up 42 basis points, by Maple's calculation from the Bank's series.

Because the shorter yield rose more, the gap between the two narrowed, from 84 basis points at the end of 2025 to 48 basis points on October 29. Shorter-term yields tend to track the Bank of Canada's policy rate more closely than longer ones.

On October 28 the Bank raised its target for the overnight rate by 25 basis points to 2.5 per cent, according to its announcement that day. The two-year benchmark yield was 3.41 per cent on the day of the decision.

Jobs and inflation in the latest data

The two other monthly yardsticks both refer to September. The Labour Force Survey, released October 9, showed employment fell by 68,000 and the unemployment rate rose to 6.5 per cent from 6.4 per cent in August.

Over the year the job count grew. Employment in September was up 95,000, or 0.5 per cent, from September 2025, Statistics Canada said. Average hourly wages rose 2.3 per cent to C$37.64, on figures that are not seasonally adjusted.

Consumer prices rose 3.1 per cent in the year to September, after 3.0 per cent in August, according to the Consumer Price Index released October 19. Wage growth of 2.3 per cent sat below that rate.

Gasoline led the acceleration, Statistics Canada said. Its prices were up 27.8 per cent from a year earlier in September, after 22.8 per cent in August, and the index excluding gasoline rose 2.2 per cent, after 2.4 per cent. Maple looked at what firms and households expect from prices next in Roughly Half of Surveyed Canadian Firms Plan to Raise Prices.

Canada's key economic numbers at a glance

Canada's economy in fall 2026: four common questions

Is Canada in a recession? Not on the data published so far. Real GDP rose 0.1 per cent in the first quarter of 2026 and 0.8 per cent in the second, according to Statistics Canada's August 28 release, and its October 30 estimate for the third quarter is growth of 0.3 per cent. Two consecutive quarterly declines, a common shorthand for a recession, do not appear in those figures.

How much is the Canadian dollar worth? It was worth 71.63 US cents on October 30, 2026, according to the Bank of Canada's daily average, equal to C$1.3960 per US dollar. Its lowest day of 2026 was October 9, at 70.07 US cents.

What are Canada's inflation and unemployment rates? Consumer prices rose 3.1 per cent in the 12 months to September 2026, Statistics Canada reported on October 19. The unemployment rate was 6.5 per cent in September, according to the October 9 Labour Force Survey.

When will third-quarter GDP be published? Statistics Canada has scheduled its official third-quarter estimate, with full September figures, for November 30, 2026.