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Canada's real gross domestic product rose in May for a second straight month, with preliminary data pointing to a further increase in June, Statistics Canada said on Friday.
Real GDP added 0.3% monthly in May, while the preliminary figure indicated a 0.2% month-over-month increase in June, according to a StatsCan statement.
May's GDP expansion was higher than a 0.2% monthly advance in a survey compiled by Bloomberg.
Goods-producing industries led the growth, expanding 0.6% monthly as most sectors within the category improved. Service industries increased 0.2%, driven mainly by gains in real estate and rental and leasing, along with public administration.
For the second straight month, the mining, quarrying, and oil and natural gas extraction sector was the main driver of economic growth.
Overall, 13 of 20 industries posted increases in May, pointing to a broad-based economic expansion, added StatsCan.
With the advance estimate for June, GDP points to a growth of 0.8% in the second quarter of 2026, according to the agency.
The gains came after two successive quarters of negative growth for Canada's economy that had been deemed in a technical recession. However Friday's report set aside fears of a slowing economy amid constant US tariff threats.
"After all the collective angst about a possible technical recession just a few months ago, it's now clear that the underlying economy is still grinding ahead, with GDP up 1.7% from year-ago levels -- just shy of its 20-year average growth," Douglas Porter, chief economist at BMO Capital Markets wrote in a note.
Porter characterized the rise as a well-rounded gain, supported by consumer spending as Canada hosted its first FIFA World Cup matches. While high energy prices continue to boost inflation, the Bank of Canada is unlikely to need to soon raise rates to slow rising prices.
"As a result of today's sturdy readings, we are revising our Q2 growth estimate to 3.0%, and the full-year estimate up a tick to 0.8%. For the Bank of Canada, this will provide them with a bit more evidence that the economy is adapting to the trade uncertainty, and will trim their estimate of slack. But it likely won't change the bigger picture concerns of fresh tariff threats and lofty energy prices -- we still see the Bank on hold this year," Porter wrote.