Canada Slips Into Technical Recession as 5-Month Investment Slide Deepens CUSMA Uncertainty
Updated
Updated · Global News · Jun 26
Canada Slips Into Technical Recession as 5-Month Investment Slide Deepens CUSMA Uncertainty
3 articles · Updated · Global News · Jun 26
Summary
Deloitte said Canada was in a technical recession from October 2025 through March 2026, while stressing the downturn does not resemble a traditional recession marked by broad job losses.
Five straight months of falling business investment and uncertainty ahead of the July 1 CUSMA review are keeping firms in a holding pattern and dragging on growth.
Deloitte forecasts GDP growth slowing to 0.7% in 2026 from 1.7% in 2025, warning that failure to extend CUSMA or further U.S. tariff escalation would hit exports and confidence.
Sectoral U.S. tariffs on steel, aluminum, lumber and autos are already hurting parts of the economy, though Prime Minister Mark Carney said 85% of Canada-U.S. trade remains tariff-free.
The report also flagged a weak labour market, higher energy costs and supply-chain strains from the Iran war, even as a peace agreement may ease some external pressure.