Canadian manufacturing navigated a turbulent 2025 as U.S. tariff uncertainty depressed M&A deal volumes to their lowest levels since COVID-19, while the PMI signaled softening demand through mid-year. Despite these headwinds, activity recovered in Q4 as capital was deployed into fewer, higher-conviction transactions. Heading into 2026, a stabilizing rate environment, a weak Canadian dollar attracting cross-border interest, and record private equity dry powder create a constructive backdrop — with the July CUSMA review emerging as the defining event for the sector.