It\u2019s safe to say none of us saw this mess coming. Who knew when Canadian grizzly bears went to sleep last fall amidst a concerned buzz over how the US election would turn out, they would wake up in the spring to threats of annexation, a global trade war, plunging stock portfolios and a federal election with one of the highest voter turnouts in recent history?<\/p>
After all the economic and political turmoil of the past few months, it\u2019s easy to wonder if we\u2019ve entered full-blown recession territory. But are we in a recession? Here\u2019s what the data says.<\/p>
TLDR: Early data suggests that Canada\u2019s real GDP growth went down in Q1 2025, but this does not (yet) indicate a recession as real GDP growth was up the previous quarter.<\/p>\n<\/div>\n
The most common recession indicator is falling gross domestic product (GDP). This means a country\u2019s rate of producing goods and services has slowed down\u2014a pretty sure sign that businesses and people have fallen on hard times.<\/p>
The rule of thumb is that a country is in a recession when it has had two back-to-back quarters of negative real GDP growth. Basically, we\u2019re in trouble if GDP growth (adjusted for inflation) slows down for the second quarter in a row.<\/p>
Advance data suggests that Canada\u2019s real GDP growth went down by 0.15% in the first quarter of 2025 from 0.65% to 0.4%. That\u2019s not good, but real GDP growth was up the previous quarter, so the slump hasn\u2019t lasted long enough to officially declare a recession in Canada.<\/p>