Canada GDP Research Brief

GDP growth staged a comeback. Canada’s economy grew at an annualized pace of 2.6 per cent in the final quarter of 2024, far exceeding market expectations. Lower interest rates spurred a substantial rebound in sectors sensitive to borrowing costs, led by a 16.7 per cent surge in residential investment and a 14.2 per cent jump in durable goods consumption. On a per-capita basis, GDP expanded at an annualized rate of 0.9 per cent amid slowing population growth, reaching its highest level since the first quarter of 2023. Combined with a sizable upwards revision for the first three quarters, total GDP grew 1.5 per cent in 2024, surpassing previous projections. While January is projected to see a 0.3 per cent monthly gain, trade tensions could weigh on economic growth in the near term, if escalated.