Canada’s economy expanded 0.2% in February, matching expectations and extending the goods-side rebound that has now driven growth for two consecutive months. The headline masks a more interesting story underneath: manufacturing roared back to life with its biggest monthly gain since January 2023.
Manufacturing jumped 1.8% in February, with durable goods leading the charge at +3.6%. The standout was machinery manufacturing, up a chunky 8.7% on strength in industrial and metalworking machinery, with higher exports doing the heavy lifting. Transportation equipment manufacturing rebounded 5.5% after January’s 7.0% drop, as Ontario auto plants came back online following model-change and retooling shutdowns. Motor vehicle manufacturing alone surged 20.4%, riding the wave of higher US production demand.
The auto story carried through to wholesale trade, which rose 0.9% as motor vehicle and parts wholesalers gained 6.1%. Transportation and warehousing tacked on 1.2%, with truck transportation logging its largest gain since March 2021 — a clean read on goods movement broadening out beyond just autos.
Mining and oil and gas added another 0.4%, with conventional crude in Saskatchewan and Newfoundland & Labrador picking up the slack from oil sands maintenance shutdowns in Alberta. Metal ore mining jumped 2.7% as copper exports climbed.
The drag came from the public sector, down 0.3% on broad weakness across public administration, education, and health care. Arts and entertainment cratered 2.5%, but that’s pure noise — the NHL’s two-week Olympic break for Milano-Cortina did the damage and reverses out next month.
The advance estimate has March essentially flat, leaving Q1 GDP tracking at +0.4%. That’s a respectable handoff into a quarter where tariff uncertainty has been the dominant macro story. The pull-forward dynamic likely flattered February’s manufacturing and trade numbers — something to watch as the data rolls forward and the front-running fades.
