Canada's economy shrinks, BlackBerry stock surges and USMCA compliance rates: Business and investing stories for the week of June 29

Globe and Mail

12 hours ago

Getting caught up on a week that got away? Here's your weekly digest of The Globe's most essential business and investing stories, with insights and analysis from the pros, stock tips, portfolio strategies and more.
The Canadian economy dipped slightly in April as the manufacturing sector posted its largest drop since April 2021 in the face of U.S. tariffs. Statistics Canada said Friday that real gross domestic product edged down 0.1 per cent in April, and its advance estimate for May suggests another 0.1 per cent decline. The weak data supports economists' expectations of a slowdown this year brought on by the U.S. trade war, which will increase pressure on the Bank of Canada to support the economy with interest rate cuts, Nojoud Al Mallees reports.
Meanwhile, U.S. President Donald Trump said Friday he is ending trade discussions with Canada and will soon impose a blanket tariff on all of the country's products in retaliation for Ottawa's digital services tax. Canada is set to start levying the digital services tax next week. Ottawa and Washington have been in intensive trade negotiations aimed at reaching a deal by late July. Little is know about the details of the discussions, but Mark Rendell spoke to several business leaders and industry representatives who've had conversations with Canada's negotiating team.
BlackBerry Ltd's stock soared Wednesday after the company reported stronger-than-expected revenues and operating profits in its fiscal first quarter and first net profit in more than three years. The Canadian technology company and onetime smartphone leader reported Tuesday after market close that it generated revenue of US$121.7-million for the quarter ending May 31, down 1.4 per cent year-over-year but nearly US$10-million above consensus estimates.
As Sean Silcoff reports, the company has been on a roll under CEO John Giamatteo, a veteran tech executive from Long Island, N.Y., who started his career at Nortel Networks and became BlackBerry's CEO in late 2023, after serving as the head of its cybersecurity division. On his watch, the company has slashed costs, sold a money-sucking cybersecurity unit for a fraction of the price his predecessor John Chen paid for it, achieved positive operating cash flows in several recent quarters and refocused the company on its car software business. But analysts – and management – cautioned the company faces uncertainty from its car software business in the second quarter due to the impact of U.S. President Donald Trump's tariffs on auto sales.
When Mr. Trump implemented his 25-per-cent tariff on most imports from Canada and Mexico in early March, he provided an exemption for goods that are compliant with North America's free-trade agreement, the United States-Mexico-Canada Agreement. Last year, fewer than 40 per cent of goods Canada shipped to the U.S. officially met USMCA rules-of-origin, but trade experts believed that the majority of Canadian exports could become compliant with the completion of the necessary paperwork – and that has worked to some degree. In April, the USMCA compliance rate for Canadian exports surged to 60 per cent. But some industries have faced a greater challenge in achieving compliance. For example, compliance rates for many other manufacturing sectors held steady or even slipped compared with last year. Jason Kirby takes a closer look at the numbers in this week's Decoder series.
A new report from credit agency TransUnion found that Canadians aged 30 and under are failing to make payments on their mortgages at a rate seven times higher than the rest of the population. According to the data, 29- and 30-year-olds had the worst mortgage delinquency rates at 1 per cent and 1.1 per cent, respectively – nearly 10 times the average national rate. Salmaan Farooqui writes that it's more evidence the current period of mortgage renewals, a result of a pandemic-era rush to buy housing five years ago amid lower interest rates, is taking a toll on Canadian homeowners.
Many credit professionals said young Canadians are missing mortgage payments more often than others because they don't have the savings built up to protect them from the unexpected costs of home ownership. Another reason is that elevated interest rates have led to drastically higher monthly payments.
After nearly three decades of offering financial wisdom to readers, The Globe's personal finance columnist Rob Carrick is retiring. He has written about everything you need to know about managing your money in Canada – including investments, real estate, mortgages, taxes retirement and much more. In his final column before retiring, he outlines eight lessons learned in his 27 years of covering personal finance and investing, and shares solutions to common money challenges. He also leaves us with some of his favourite reader interactions from over the years: 'A guy once walked up to me while I was showering at the gym to ask if I thought the government would raise the contribution limit for tax-free savings accounts that year. And, believe it or not, there are people out there who want selfies with a personal finance columnist.'
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