Canada's economic momentum,
measured quarterly.
Tracks whether Canada's economic foundations are accelerating or decelerating. Not where we are — where we're going.
What is the Canada Momentum Index?
The Canada Momentum Index is a composite macroeconomic instrument that measures whether Canada's structural economic foundations are accelerating or decelerating over time. It is built entirely from public Statistics Canada data and tracks five pillars: real GDP per capita, labour productivity, export diversification, business investment per worker, and business R&D intensity. The index is updated quarterly as new data becomes available and is designed to be non-partisan, transparent, and fully reproducible.
Unlike traditional economic indicators that measure absolute levels or rankings, Canada Momentum measures direction — specifically, whether recent trends are outpacing long-run baselines. A score above 50 indicates structural acceleration. A score below 50 indicates deceleration. A score near 50 means the economy is tracking its own long-term trend.
How is it calculated?
For each of the five pillars, a 4-quarter rolling average is applied to smooth noise. Then two rolling linear regressions are computed: a 3-year (12-quarter) slope capturing medium-term direction, and a 10-year (40-quarter) slope capturing the long-run baseline. The structural momentum is the difference between these slopes — positive means the recent trajectory exceeds the long-run trend.
Each pillar's momentum is standardized to a z-score and bounded using the hyperbolic tangent function, producing a comparable score between −1 and +1. The composite index is the equal-weighted average of all five pillar scores, scaled to a 0–100 range where 50 represents structural neutrality. No subjective adjustments are applied.
How it works
The Canada Momentum Index computes a single composite score each quarter by measuring the acceleration or deceleration of five structural economic pillars relative to their own long-run trends.
The five pillars
Real GDP per Capita — Expenditure-based GDP in chained dollars divided by quarterly population estimates. Captures per-person wealth creation, removing population growth distortion. Source: Tables 36-10-0104-01 and 17-10-0009-01.
Labour Productivity — Output per hour worked in the business sector. The core driver of long-run prosperity and competitiveness. Source: Table 36-10-0206-01.
Export Diversification — An inverted Herfindahl-Hirschman Index computed from quarterly merchandise exports by trading partner. Higher scores indicate less concentration risk. Source: Table 12-10-0011-01.
Business Investment per Worker — Non-residential gross fixed capital formation divided by quarterly average employment. A proxy for capital deepening and future productive capacity. Sources: Tables 36-10-0108-01 and 14-10-0287-01.
Business R&D Intensity — Business enterprise research and development expenditure as a share of GDP. A direct measure of investment in future capability. Source: Table 27-10-0273-01. Annual data, forward-filled across quarters.
Structural signal (3-year vs 10-year)
For each pillar, a 4-quarter rolling average is applied to reduce noise. Two rolling linear regressions are then computed: a 3-year (12-quarter) short-run slope and a 10-year (40-quarter) long-run slope. The structural momentum is the difference. When the short-run slope exceeds the long-run slope, the pillar is accelerating relative to its own baseline.
Nowcast signal (1-year vs 10-year)
The Nowcast uses the same methodology but substitutes a 1-year (4-quarter) slope for the 3-year slope. This produces a faster-moving signal that is more responsive to recent shifts in direction. Both signals share the same 10-year baseline.
Standardization and bounding
Each pillar's momentum value is standardized to a z-score across its full history, then bounded via tanh(z/2). This produces a score in the range [−1, +1] that is comparable across pillars and resistant to extreme outliers such as the COVID-19 shock.
Composite index
The composite index is the equal-weighted average of all five pillar scores, scaled to 0–100 where 50 represents structural neutrality. Equal weighting is a deliberate design choice to avoid embedding policy bias into the instrument.
Full historical series are recomputed on each data refresh to incorporate Statistics Canada revisions. Historical values may change slightly as source data is revised. All source tables are publicly available at statcan.gc.ca.
Current Canadian Economic Questions
Latest release: Q4 2025
What is Canada's real GDP per capita?
In Q4 2025, real GDP per capita in Canada stood at approximately $396,638 (chained 2017 dollars). This measure divides expenditure-based gross domestic product, deflated to 2017 prices, by the quarterly civilian population estimate. It removes the effect of population growth to isolate per-person economic output. The Canada Momentum Index uses real GDP per capita as its primary measure of per-person wealth creation, tracking whether its rate of change is accelerating or decelerating relative to the 10-year structural baseline. At its current level, real GDP per capita is above its structural baseline. Source: Statistics Canada, Tables 36-10-0104-01 and 17-10-0009-01.
Is Canada's economy accelerating or decelerating?
The Canada Momentum Structural Index for Q4 2025 stood at 46.0 out of 100. A reading above 50 indicates that Canada's broad economic foundations are accelerating relative to their long-run trends; a reading below 50 indicates structural deceleration; 50 represents neutrality. The composite score is the equal-weighted average of five structural pillars: real GDP per capita, labour productivity, export diversification, business investment per worker, and business R&D intensity. The Nowcast signal, which measures the 1-year trend against a 10-year baseline, stood at 56.1. Source: Canada Momentum composite index, derived from Statistics Canada public data tables.
How diversified are Canada's merchandise exports?
In Q4 2025, Canada's merchandise export diversification index stood at 0.52 (where 0 indicates full concentration and 1.0 indicates maximum diversification across trading partners). The index is the complement of the Herfindahl-Hirschman Index of quarterly merchandise export shares by country. The United States accounted for approximately 68% of Canadian merchandise exports in the quarter. This measure covers merchandise exports only; service exports are excluded. At its current level, export diversification is above its 10-year structural baseline. Source: Statistics Canada, Table 12-10-0011-01.
What is happening to labour productivity in Canada?
Data for Q4 2025 show that business-sector labour productivity in Canada stood at approximately 211.4 billion (chained 2012 dollars). Labour productivity measures real output generated per hour worked across the business sector and is the primary long-run determinant of real wages and living standards. At its current level, labour productivity is below its 10-year structural baseline, indicating that recent productivity growth is lagging the long-run trend. Source: Statistics Canada, Table 36-10-0206-01.
How much are Canadian businesses investing?
In Q4 2025, non-residential business investment per worker in Canada was approximately $118,463 (seasonally adjusted annual rate, chained 2017 dollars). This measure divides gross fixed capital formation in non-residential structures, machinery, and intellectual property by total employment, capturing the rate of capital deepening per worker. Capital deepening is a key intermediate driver of labour productivity and productive capacity over the medium term. At its current level, business investment per worker is below its 10-year structural baseline. Sources: Statistics Canada, Tables 36-10-0108-01 and 14-10-0287-01.
How much do Canadian businesses spend on research and development?
Using data for Q4 2025, business enterprise research and development (BERD) expenditure in Canada represented approximately 0.9% of GDP. BERD measures private-sector investment in applied research and experimental development; expressed as a share of GDP, it reflects the degree to which the business sector is investing in future productivity and technological capability. Statistics Canada publishes BERD annually; the Canada Momentum Index carries the most recent annual observation forward across all quarters in that calendar year. At its current level, BERD intensity is below its 10-year structural baseline. Source: Statistics Canada, Table 27-10-0273-01.