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Economic News

Quebec: Decline in Real GDP in October

January 27, 2026
Sonny Scarfone
Principal Economist

Highlights

  • Real GDP in Quebec fell by 0.4% in October, the first monthly decline since June. This decrease was slightly larger than the drop recorded in Canada where activity fell by 0.3%. Compared to the first 10 months of 2024, Quebec’s GDP still shows a cumulative increase of 0.9% (see table 1).
  • The weak print in October reflects softness in both goods producing industries (-0.4%) and services (-0.3%). For goods, beyond the agriculture, forestry, fishing and hunting category, manufacturing was particularly affected and now shows the largest cumulative decline since the start of the year (-3.6%). In services, the beginning of the fourth quarter was also rather weak for wholesale and retail trade.
  • Among the sectors that helped limit the decline in real GDP, utilities, accommodation and food services, and the finance and insurance sector all posted gains.

Comments

After a modest return to growth in the third quarter External link., when exports stalled following the sharp decline in the second quarter, Quebec’s economy weakened again in October. GDP by industry shows that sectors tied to international trade such as manufacturing, wholesale trade and transportation and warehousing remain under pressure. Although effective tariff levels External link. remain low due to greater compliance with the Canada-United States-Mexico Agreement (CUSMA), which exempts a large share of duties, Quebec remains more exposed than other provinces because of sector specific tariffs targeting several of its key exports, including aluminum, wood products and the production of trucks and buses.

Implications

Supported by a resilient labour market and major projects underway in both the private and public sectors, a GDP rebound is expected and the fourth quarter should close in positive territory, resulting in overall economic growth of 0.8% in 2025. However, the onset of demographic stagnation External link. will restrain consumption and the continued consolidation of government spending will also weigh on domestic demand. As a result, the outlook will depend largely on a recovery in exports and on the strength of public and private investment. For these reasons, even as the year begins once again in a context of geopolitical uncertainty and ahead of the scheduled CUSMA review on July 1st, our latest forecasts External link. call for a moderate acceleration in economic activity in Quebec in 2026, reaching 1.1 %.

NOTE TO READERS: The letters k, M and B are used in texts, graphs and tables to refer to thousands, millions and billions respectively. IMPORTANT: This document is based on public information and may under no circumstances be used or construed as a commitment by Desjardins Group. While the information provided has been determined on the basis of data obtained from sources that are deemed to be reliable, Desjardins Group in no way warrants that the information is accurate or complete. The document is provided solely for information purposes and does not constitute an offer or solicitation for purchase or sale. Desjardins Group takes no responsibility for the consequences of any decision whatsoever made on the basis of the data contained herein and does not hereby undertake to provide any advice, notably in the area of investment services. Data on prices and margins is provided for information purposes and may be modified at any time based on such factors as market conditions. The past performances and projections expressed herein are no guarantee of future performance. Unless otherwise indicated, the opinions and forecasts contained herein are those of the document’s authors and do not represent the opinions of any other person or the official position of Desjardins Group.