Canada's economy expanded at a 3.3% annualized rate in the second quarter of 2026, the fastest pace since 2023 and the strongest among G7 nations, Statistics Canada data showed, well above the Bank of Canada's 2.5% July forecast. A 3.6% jump in exports—the largest quarterly gain in more than three years, including a 27% surge in automotive shipments—combined with a 1.0% rebound in domestic final demand, a 2.3% rise in business capital investment, and 0.8% growth in household spending. First-quarter GDP was revised to 0.3% growth from a previously reported 0.1% contraction, ending concerns about a technical recession after a 1% drop in the fourth quarter of 2025. Finance Minister Francois-Philippe Champagne said stimulus and trade diversification are working, while strategists at Manulife and Desjardins pointed to firmer confidence even as they flagged trade risks. Momentum faces a severe test after Prime Minister Mark Carney halted White House talks, new U.S. surtaxes took effect, Ottawa set countermeasures for September 8, and President Donald Trump threatened to lift the auto surtax to 50%; TD Bank estimates the levies could cut next year's growth by 0.3 to 0.6 percentage points, with full-year growth near 1.5%, as Canada deploys a C$7.5 billion support package and seeks non-U.S. markets.