Uncertainty about US President Donald Trump’s trade policy is curbing Canadian business investment and consumer spending, though firms see the economy avoiding a bad recession, central bank surveys show.

Canadians say they’re ramping up their boycott of US travel and products in response to US President Donald Trump’s tariffs, and the country’s central bank is taking notice. “I won’t be going to the US anytime soon,” one respondent told the bank. “I don’t feel good about spending my money there.”

Canadian retail sales grew at the fastest pace this year in June, according to an official estimate, bouncing back from a slowdown in May. *June sales likely +1.6% m/m *May sales -1.1% and April +0.4% *2Q sales estimate +0.4% q/q, the weakest quarterly pace in a year

Canadian consumer prices accelerated for the first time in four months and underlying price pressures were firmer, likely keeping the central bank from cutting interest rates on July 30. *CPI +1.9% y/y in June, up from 1.7% in May *The index +0.1% m/m last month *Core rates +3.05%, up from 3%

The Canadian economy shrugged off tariff uncertainty, adding the most jobs in six months with the unemployment rate falling for the first time since January. *Employment +83,100 in June *Jobless rate fell 0.1 pp to 6.9% *Part-time work made up 84% of job gains *Private +47,000; public +23,000

It seems that nothing Canada has tried so far has shielded it from the threats of Donald Trump. Love this quote from @karl-schamotta.bsky.social: “There was hope that there was light at the end of the tunnel — unfortunately it appears that light is a train.”

Canadians are committed to ditching US travel, taking the fewest number of car trips there in the year’s first half since at least 2017, excluding the pandemic. *Canadians returned from 8m trips in 1H, vs. 11m in 2024 *Canadian return trips by car from the US -33% y/y in June *And by air -22% y/y

A growing number of migrants in the US are heading north, even as Canada adopts increasingly restrictive immigration policies of its own. *Saint-Bernard-de-Lacolle crossing saw asylum claims jumped by more than 400% y/y, first six days of July *Claims +128% in June; +82% so far this year

Canada should become a world leader in producing and processing raw materials for military equipment and defense systems, according to the Business Council of Canada.

The Canadian economy is on track for a modest decline this quarter, yet isn’t deteriorating as fast as some economists feared. *April GDP -0.1% m/m *May GDP also -0.1% m/m *Assuming no growth in June, 2Q likely -0.3% q/q annualized, vs economist estimates of -0.5% and BOC forecast of 0% to -1.3%

Youth unemployment in Canada jumped 3.6 pp over the past two years, the sharpest increase among the 25 largest OECD economies — including the US, UK and Australia. As of May, one in seven Canadian youth can’t find work, and they’re more than twice as likely as other age groups to be unemployed.

Canadian consumer prices held steady while core measures eased slightly, likely giving some relief to Bank of Canada policymakers who had raised concerns about hotter underlying inflation prints in recent months. *CPI rose 1.7% y/y in May, matching April's pace *Core +3%, down from 3.1% in April

Tighter immigration rules have cut off the fuel from the Canadian population growth engine. *Canada added just 20,107 people in 1Q *That's 0% quarterly population growth vs. 1Q average of 0.3% over the past decade *It's the slowest quarterly rate since records began in 1946, tied with 4Q of 2014

Bank of Canada officials said it would be tough to cut the policy interest rate further if core inflation remains firm, but acknowledged more easing may be needed if the economy continues to weaken.

By 2030, Bloomberg Economics forecasts, if Trump’s current tariff regime endures, the global economy will be $1 trillion smaller than it would have been had the US remained in the Trans-Pacific Partnership.

Cross-border road trips to the US from Canada fell for a fifth straight month in May. *Canadian-resident return trips by automobile from the US -38.1% y/y *Canadians’ return trips by air from US -24.2%, versus +9.8% from other countries *US car trips to Canada -8.4%

Canada’s trade-driven sectors are showing clearer signs of a pullback in activity brought on by US President Donald Trump’s tariffs. *Manufacturing sales fell 2.8% in April, the largest monthly drop since October 2023 and the lowest level since early 2022 *Wholesale sales dropped 2.3%

The Canadian economy eked out minor job gains, and the unemployment rate rose for a third straight month to the highest level since September 2016 outside of the pandemic. *Employment grew by 8,800 positions in May *Jobless rate rose 0.1 ppt to 7% *Number of unemployed people +13.8% y/y

Businesses believing that the worst-case tariff scenarios were less likely to become reality helped convince Bank of Canada policymakers to stay on the sidelines this month.

Canadian exports plunged by the most in nearly 17 years outside of the pandemic, widening the country’s merchandise trade deficit to the largest on record. *Canada's trade deficit reached C$7.1 billion in April *Total exports fell 10.8%; imports were down 3.5% *Exports to the US plunged 15.7%

Economists are abandoning their calls for monetary-policy easing in Canada next week as traders price in only a small chance of an interest-rate cut and the nation’s output beat all estimates. BMO and RBC now expect no changes in rates next week, contrary to the cut they saw before.

A strong jump in tariff-driven exports fueled Canada’s growth at the start of this year, offsetting domestic weakness in other parts of the economy. *1Q GDP +2.2% annualized, up from 2.1% in 4Q *Monthly GDP +0.1% in March and likely +0.1% in April *Traders pared expectations for a June 4 rate cut

The economic gains of Prime Minister Mark Carney’s defense spending boost will likely be worth more than double the planned investment costs, according to Canadian Imperial Bank of Commerce economists.

Great view of King Charles and Queen Camilla from our Bloomberg Ottawa office during their visit to Canada

Canadians have returned from 1.35 million fewer road trips to the US over the past two months than they did a year ago, eschewing crossing the border that US President Donald Trump called “artificial” and wanted removed.

Canadians are growing more optimistic about the economy, as the conclusion of a national election relieves some anxiety around the country’s direction and US President Donald Trump’s threats, according to the Bloomberg Nanos Canadian Confidence Index.

Canada’s tepid pace of job creation last month sent the unemployment rate soaring back to a level last seen in November, the highest since January 2017 outside of the pandemic. *Employment grew by just 7,400 positions in April *Jobless rate +0.2 percentage points to 6.9%

Canadian exports to the US plunged 6.6%, the biggest drop since the pandemic. Imports fell 2.9%. Exports to countries other than the US jumped 24.8%, however, almost entirely offsetting the decline in outbound shipments to the US. Imports from countries other than the US were also up 1%.

The Bank of Canada warned that a severe and long-lasting global trade war may cause more mortgage borrowers to fall behind on their payments — even beyond levels reached in the global financial crisis.

US President Donald Trump said newly elected Canadian Prime Minister Mark Carney plans to visit the White House within the next week. “I think we’re going to have a great relationship. He called me up yesterday. He said ‘Let’s make a deal,’” Trump told reporters.

Bank of Canada officials considered cutting rates in April but US President Donald Trump's ever-changing tariff plans over the course of their deliberations held them back.

The Canadian economy appears to be taking a bigger hit from tariff uncertainty than expected. *1Q industry-based GDP grew at an annualized pace of +1.5% *Slightly weaker than Bank of Canada's +1.8% estimate *Feb GDP -0.2% m/m., and March likely +0.1%

Mark Carney has made something of a career specialty out of dealing with crises. His next challenge: dealing with the dark economic clouds that are rolling in from the south.

Canadian Conservatives are backing Pierre Poilievre despite losing the election to Mark Carney’s Liberals, saying the party made significant gains in the province of Ontario and among young voters.

Canada’s Liberal Party won a fourth straight election, as voters chose former central banker Mark Carney to manage the country’s response to President Donald Trump’s trade war. The margin of victory was narrow: *Liberals won ~168 seat seats *Conservatives won 144 (172 seats needed for a majority)

Donald Trump’s Nov. 5 victory capped a bad year for incumbents as authoritarian populists gained ground in elections across the globe. The tide seems to be turning. Center-left governments in Canada and Australia, once appeared destined to lose office, are seeing their electoral fortunes revived.

Canadian consumers may have tried to beat the price hikes of a trade war last month with the biggest spending growth since the holiday season. (Possibly driven by car sales.) *Advance data suggest sales +0.7% m/m in March *That's up from -0.4% in Feb. and -0.6% in Jan. *1Q sales likely +1.1% q/q

More Conservative millionaires are thinking about leaving Canada than their Liberal counterparts with the right-leaning party at risk of losing a fourth straight election. A survey by investment migration consultancy Arton Capital showed 34% said they're more likely to leave Canada now.

Canadians poured a record amount into US equities in February, even as a movement to boycott US products and vacations gained momentum. *Investors bought C$29.8 billion in US shares *They sold C$2 billion of non-US shares (S&P 500 reached record close on Feb. 19; now down more than 14% since then)

More than nine years after the Liberals swept to power, many younger voters are frustrated. Millennials and Gen Z have been consumed by a cost-of-living crisis that’s made the prospect of home ownership and a timely retirement appear increasingly out of reach.

The uncertainty around President Donald Trump’s trade policy prompted the central bank to publish two sets of forecasts to capture different outcomes of a global tariff war: a temporary stall in Canadian activity or an outright downturn that lasts a year.

Canadian consumer prices unexpectedly cooled, but markets and economists still leaned toward the Bank of Canada holding rates steady Wednesday amid tariff uncertainty. *CPI rose 2.3% y/y in March vs 2.7% expectations *The index up 0.3% m/m vs 0.7% *Core average 2.85% vs 2.95%

Canada’s new immigration curbs have slowed population increases, but government projections are likely “off the mark,” said CIBC's Deputy Chief Economist Benjamin Tal. Official projections: 0.3% in 2025 and -0.2% in 2026 Tal's forecasts: 1.1% this year and 1% next year

General Motors Co. will temporarily halt production at a factory in Ingersoll, Ontario that makes commercial vans, the second Canadian assembly plant to shut this month (after Stellantis NV which shut down a plant that makes Chrysler and Dodge vehicles in Windsor, Ontario).

Canada is hitting back against Trump's auto tariffs with import taxes of as much as 25% on vehicles assembled in the US — and the biggest American automakers will bear the brunt. Ford, GM and Stellantis have the biggest share of Canadian sales that rely on US imports, according to Jato Dynamics.

150 tech CEOs and leaders are calling for a “real debate” about Canada's economic future when party leaders discuss views on stage next week. "For too long, Canadian government leaders have prioritized short-term economic interests and photo ops over investment into Canada’s economic well-being."

Canadian travelers are keeping their distance from the US, a country that was once their top destination, as tensions between the two nations grow.

Canada is seeing an uptick of asylum seekers at its border following US President Donald Trump’s decision to end protected status for more than 500,000 Haitians in the US.

Bank of Canada surveys show firms believe upward price pressures from the trade conflict with the US will exceed the downward pull from weaker demand, threatening to undo progress on keeping inflation expectations well-anchored.

The Canadian government issued a new warning for travelers entering the US, saying they should “expect scrutiny” at the border and that their phones and other electronic devices may be searched.