October GDP decline shows bite marks of Trump’s attack

By Tom Parkin

December 24th, 2025

BURLINGTON, ON

Tariffed sectors headed down in October along with residential construction and retail, the warning bell of too few Canadians with money to spend.

Economy shrank in most months of 2025, to October

Change in monthly GDP, annualized and adjusted for season and inflation

Canada’s gross domestic product fell by 0.3 per cent in October and the data released by Statistics Canada on Tuesday had some tell-tale signs of the United States president’s attack on Canada.

All data in this report is adjusted for seasonal and inflation. GDP values are annualized; per cent changes are not.

October’s 0.3 per cent decline wiped out September’s 0.2 per cent GDP gain. In six of the ten months of 2025 now reported, GDP fell. October GDP was $1.3 billion less than January.

Trump tariffed industries fall in October

Monthly, Jan 2021 to Oct 2025, annualized and adjusted for season and inflation

The Trump administration has put tariffs on U.S. imports of lumber, steel, aluminum and assembled vehicles. Though the sectoral tariffs are global, the effect is a more intense attack on working Canadian because of higher trade volumes in those sectors compared to other countries.

In October, sawmills production fell $382 million from September. Iron and steel dropped $54 million. Aluminum fell $53 million. Auto assembly dropped $80 million In October, all four manufacturing sectors were below January’s levels.

Residential construction and retail down

Monthly, Jan 2022 to Oct 2025, annualized and adjusted for season and inflation

However, as the charts also show, key sectors were already facing challenges before Trump and not all the economic damage has been externally inflicted.

Over many years, and under various parties in Ottawa and provincial capitals, Canadian economic growth has been weak.

The weight of the winter 2022 housing sector collapse continues to crush residential construction jobs, with the sector down $212 million between September and October. The sector is down $7.7 billion since its peak in March 2022, when higher interest rates ended soaring housing prices.

The declines and resulting unemployment together with high prices pushed down on retail sales and retail workers. The sector fell $791 million in October and is now $1.3 billion below its December 2024 peak. This signal of weak household spending echoes detailed quarterly data released last month showing household consumer demand falling.

GDP by sector, October

GDP by industry, Oct 2025, annualized and adjusted for season and inflation