After a significant jump of 0.5% in April, Quebec’s gross domestic product increased by 0.1% in May.
Although more modest, the advance in May is a sign that growth is continuing in Quebec while the Canadian economy is showing signs of slowing. In April, growth came from the goods sector while the services sector remained stable.
The reduction in electricity production by Hydro-Québec, which wants to increase the low water level in its reservoirs, weighed on May’s GDP, notes economist Daren King of the National Bank.
Since the beginning of 2024, cumulative growth in Quebec’s GDP has been 0.5%. The Quebec economy is showing resilience, but there is a downside, says Desjardins economist Hélène Bégin. “The moderate deterioration in the job market continues,” she points out. “The delicate financial situation of many companies is restricting hiring and sometimes even leading to layoffs.”
According to the Desjardins economist, the job market will remain dull for a few more months, “until the Bank of Canada’s key rates drop enough to ease the burden on heavily indebted businesses and households.”