06:54 AM EDT, 09/03/2025 (MT Newswires) -- Bank of Montreal (BMO) said Canada's economy contracted at a 0.5% annual rate in the six months since the trade uncertainty emerged at the end of January, but the slowdown does not qualify as a recession.

The bank cited preliminary July data from Statistics Canada showing a 0.1% month-over-month gain.

While the pullback is the weakest six-month stretch in nearly a decade outside the pandemic, it is less severe than early projections tied to trade tensions with the United States.

Canada's economy shrank in four of those six months, BMO said, but the scale of the decline is smaller than the recessions in 2009 and 2020. The bank compared the current period to close calls in 2015/16, during the oil price slump, and in 2001, during the tech meltdown.

As in those episodes, the weakness is concentrated in specific areas, this time in heavy manufacturing and in Ontario and Quebec, the bank said.