World Economy

Canada February GDP Growth Flat

Canada February GDP Growth FlatCanada February GDP Growth Flat

Canadian economic growth took a pause in February after the break-neck pace seen at the start the year. Statistics Canada said gross domestic product was unchanged in February, matching the expectations of economists, according to Thomson Reuters.

February followed three months of gains including stronger-than-expected growth in January. “After the exciting growth figures of recent months, it was perhaps inevitable that the Canadian economy would take a slight breather,” TD Bank senior economist Brian DePratto wrote in a report.

Despite the result, DePratto noted that momentum heading into the year remains consistent with a solid economic expansion.

Statistics Canada said gains in service-producing industries were offset by declines in goods-producing industries for February. Service-producing industries were up 0.2% for the month as the finance and insurance sector gained 0.7%. The real estate and rental and leasing sector added 0.5%.

Meanwhile, goods-producing industries fell 0.3%, the first move lower since October. The manufacturing sector fell 0.6% in February after growing in seven of the previous eight months, while the mining, quarrying, and oil and gas extraction group fell 0.2%.

CIBC economist Nick Exarhos said the biggest headwind in February was manufacturing, but noted weakness on the goods producing side was widespread, with only construction posting an increase. “Despite what’s been an anemic pace to business investment, and still muted plans for 2017 on that front, housing starts have had a remarkable recent run,” Exarhos wrote in a report.

“Residential investment is now poised to be a modest lift to GDP this year, from a drag we had forecast earlier on. That swing explains much of the upgrade to our overall 2017 GDP outlook.”

Meanwhile, Canadian wholesale trade fell less than expected during the second month of the year amid lower sales of household goods and food.

Statistics Canada reported on Monday that wholesale sales dropped 0.2% on a seasonally adjusted basis in February to C$58.86 billion ($43.58 billion), following the preceding month’s downwardly revised gain of 3.0%, FXStreet reported.

However, that came in above analysts’ forecasts of a 1.0% decline.

In February, the amount of sales in the retail sector plunged 0.6% to C$47.8 billion ($35.1 after a 2.3% spike in January).

Negative growth was recorded in five out of 11 key sectors that represented 67% of the total retail sales.


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