The Canadian economy is expected to see muted growth in Q1 2025 followed by significant contraction in the second quarter of the year, according to the latest Main Street Quarterly report from the Canadian Federation of Independent Business (CFIB).
CFIB reports the Canadian economy grew by 0.8 percent in Q1 but is expected to significantly contract in Q2. The total Consumer Price Index (CPI) inflation rose to 2.4 percent in Q1 2025 and is expected to further increase to 2.7 percent in Q2 on a yearly basis
The CFIB reports that manufacturing and wholesale firms are the hardest hit by low demand due to their trade exposure. Additionally, one-third of wholesale firms have already increased their prices. Moreover, two-thirds of firms in hospitality and construction plan to increase their prices once supplier costs stabilize.
