{"id":60836,"date":"2025-06-13T18:04:33","date_gmt":"2025-06-13T18:04:33","guid":{"rendered":"https:\/\/www.pantheregroup.com\/2025\/06\/13\/recession-risks-alive-as-canadas-manufacturing-numbers-suffer-under-trump-tariff-regime\/"},"modified":"2025-06-13T18:04:33","modified_gmt":"2025-06-13T18:04:33","slug":"recession-risks-alive-as-canadas-manufacturing-numbers-suffer-under-trump-tariff-regime","status":"publish","type":"post","link":"https:\/\/www.pantheregroup.com\/2025\/06\/13\/recession-risks-alive-as-canadas-manufacturing-numbers-suffer-under-trump-tariff-regime\/","title":{"rendered":"&#039;Recession risks alive&#039; as Canada&#039;s manufacturing numbers suffer under Trump tariff regime"},"content":{"rendered":"<p> \n<br \/><br \/>\n<iframe loading=\"lazy\" title=\"Canada recession &#039;more likely than not&#039;: Devlin Capital\" width=\"1080\" height=\"608\" src=\"https:\/\/www.youtube.com\/embed\/6OPfD-Fy7Bg?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe><br \/>\n<\/iframe><\/p>\n<p> The dampening effect of <\/p>\n<p>                Donald Trump\u2019s tariffs<\/p>\n<p>                 on <\/p>\n<p>                manufacturing<\/p>\n<p>                 and <\/p>\n<p>                wholesale sales<\/p>\n<p>                 in Canada is leading economists to warn that <\/p>\n<p>                growth forecasts are in jeopardy<\/p>\n<p>                 and, even worse, that the numbers could portend the <\/p>\n<p>                start of a recession<\/p>\n<p>                . <\/p>\n<p> Manufacturing<\/p>\n<p>                 and <\/p>\n<p>                wholesale sales<\/p>\n<p>                , excluding petroleum, dropped 2.8 per cent and 2.3 per cent, respectively, in April from March, according to Statistics Canada data released on Friday. Analysts surveyed by Bloomberg had expected manufacturing sales to drop two per cent and wholesale sales to fall 0.9 per cent. <\/p>\n<p> \u201cFeedback from respondents highlighted the impact of the recent tariffs imposed by the United States on Canada\u2019s manufacturing sector,\u201d Statistics Canada said in a press release. <\/p>\n<p> Manufacturers said they were experiencing price increases as well as rising costs for raw materials, shipping and labour. One-third said demand for their products had changed. <\/p>\n<p> Trump\u2019s tariffs include 25 per cent duties on goods that are non-compliant with the <\/p>\n<p>                Canada-U.S.-Mexico Agreement<\/p>\n<p>                , 25 per cent on foreign-made vehicles and 50 per cent on steel and aluminum. <\/p>\n<p> Economists said the sales data put <\/p>\n<p>                gross domestic product (GDP) forecasts<\/p>\n<p>                 in the crosshairs. <\/p>\n<p> \u201cThe implications for April and second-quarter GDP are squarely negative and recession risks are alive and well,\u201d David Rosenberg, economist and founder of Rosenberg Research &#038; Associates Inc., said in a note. <\/p>\n<p> Andrew Grantham, an economist at CIBC Capital Markets, said the data suggests that GDP growth for April will be downgraded from a \u201csurprisingly positive\u201d first estimate of 0.1 per cent, and could be the prelude for second-quarter growth \u201ctracking flat.\u201d <\/p>\n<p> First-quarter GDP growth came in at 2.2 per cent, well ahead of estimates for 1.7 per cent. <\/p>\n<p><iframe src=\"https:\/\/flo.uri.sh\/visualisation\/22097836\/embed\"><\/iframe><\/p>\n<p> On the manufacturing front, petroleum and coal, vehicle sales and primary metals, such as aluminum, contributed the most to April\u2019s decline. <\/p>\n<p> Excluding petroleum and coal, manufacturing sales fell 1.8 per cent in April from March and are down 2.7 per cent year over year. <\/p>\n<p> \u201cAdding insult to injury was the 6.8 per cent month-over-month contraction in new manufacturing orders,\u201d Rosenberg said. <\/p>\n<p> Orders have fallen in two of the past three months, he said, adding that orders for \u201cbig-ticket durable goods\u201d shrivelled 10.5 per cent in April, \u201cthe sharpest slippage in nearly three years.\u201d <\/p>\n<p> Rosenberg said this data is \u201ckey because new orders are, after all, a leading indicator and the mother\u2019s milk for future demand.\u201d <\/p>\n<p> On the wholesale front, sales fell in six of the seven subsections, accounting for 81.6 per cent of the total. <\/p>\n<p> Motor vehicles and parts led the decrease in April, falling 6.5 per cent, a U-turn from March, Statistics Canada said. <\/p>\n<p> As the tariff war got underway, Ontario and Quebec were singled out as being among the provinces most vulnerable to Trump\u2019s tariffs, something the latest manufacturing and wholesale data supported. <\/p>\n<p> Ontario manufacturing sales dropped 2.4 per cent in April, or $31 billion, representing the largest dollar decline since March 2024. Quebec\u2019s contracted the second-most in dollar-terms, down\u00a0 $17.5 billion, the fourth straight monthly drop. <\/p>\n<p> Ontario also recorded the largest decrease in wholesale sales in dollar terms as the sector contracted $910 million \u2014 a decrease of 2.1 per cent. <\/p>\n<ul class=\"related_links\">\n<li>Gary Shapiro: The United States and Canada need each other. Let\u2019s make up<\/li>\n<li>Don&#8217;t assume further rate cuts from the Bank of Canada, Poloz warns<\/li>\n<\/ul>\n<p> Rosenberg said the data further questions the <\/p>\n<p>                Bank of Canada<\/p>\n<p>                \u2018s recent decision to hold <\/p>\n<p>                interest rates<\/p>\n<p>                 for a second consecutive time at 2.75 per cent at its June 4 announcement. <\/p>\n<p> \u201cHow the Bank of Canada can just sit on the sidelines as a casual observer is a good question as the disinflationary output gap widens further,\u201d he said. <\/p>\n<p> <em>\u2022 Email: gmvsuhanic@postmedia.com <\/em> <\/p>\n<p> <em><strong>Bookmark our website and support our journalism:<\/strong> Don\u2019t miss the business news you need to know \u2014 add financialpost.com to your bookmarks and sign up for our newsletters here.<\/em> <\/p>\n\n<br \/>&#039;Recession risks alive&#039; as Canada&#039;s manufacturing numbers suffer under Trump tariff regime<\/a><br \/>\n<br \/>2025-06-13 18:04:33<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>The dampening effect of Donald Trump\u2019s tariffs on manufacturing and wholesale sales in Canada is leading economists to warn that growth forecasts are in jeopardy and, even worse, that the&#8230;<\/p>\n","protected":false},"author":2,"featured_media":60837,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[31],"tags":[],"class_list":["post-60836","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy"],"_links":{"self":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts\/60836","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/comments?post=60836"}],"version-history":[{"count":0,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/posts\/60836\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/media\/60837"}],"wp:attachment":[{"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/media?parent=60836"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/categories?post=60836"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.pantheregroup.com\/api\/wp\/v2\/tags?post=60836"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}