Gross domestic product grew at an annual rate of 2.2 per cent in the first quarter, little changed from the final three months of 2024, Statistics Canada reported. A surge in exports triggered by pre-tariff stockpiling outweighed weaker domestic demand. (The Logic)

Talking point: The leading indicators in Statistics Canada’s latest tally of economic output are troubling: a measure of domestic consumption and investment in fixed capital stalled for the first time since the end of 2023 and the household savings rate dropped to the slowest in a year. Still, the trade shock from U.S. tariffs could have been worse. Exports increased at an annual rate of 6.7 per cent, while inventories increased for the first time in three quarters. Business investment in machinery and equipment jumped, a positive surprise that could signal a resolve to fight the trade war by boosting productivity. Given evidence of hotter inflation, the Bank of Canada might opt to leave interest rates unchanged next week and gather more information. President Donald Trump hasn’t broken the economy yet.