Canada’s gross domestic product fell 0.1 per cent in January: Statistics Canada

The Canadian economy took a step back in January, but the 0.1 per cent decline in gross domestic product was a slightly better result than economists had expected.

OTTAWA — The Canadian economy took a step back in January, but the 0.1 per cent decline in gross domestic product was a slightly better result than economists had expected.

Economists had estimated the Canadian economy would shrink by 0.2 per cent during the month after rising 0.3 per cent in December, according to Thomson Reuters.

Statistics Canada said Monday that January’s overall production of goods was up 0.3 per cent, helped by an increase in oil and gas extraction, utilities and the agriculture and forestry sector.

The gains were partly offset by a drop in manufacturing and, to a lesser extent, construction.

Meanwhile, the output of Canada’s service industries fell 0.3 per cent in January — the first drop since February 2014.

The federal agency attributed the decline in services to decreases in wholesale and retail trade and — to a lesser extent — in transportation and warehousing services, accommodation and food services.

The drop in gross domestic product in January came amid a steep drop in oil prices that prompted the Bank of Canada to cut its key interest rate as a form of insurance against the expected hit to the economy.

CIBC chief economist Avery Shenfeld noted the weakness in oil prices will show up in the sector’s capital spending rather than oil production, which is still likely to climb this year.

“Overall, while the first quarter will likely still be no better than one per cent growth, the issue for monetary policy will mostly be about how much of that weakness extends into the subsequent two quarters,” Shenfeld wrote in a note to clients.

In a Financial Times interview published Monday, Bank of Canada governor Stephen Poloz warned the oil-price shock will make the economy’s first-quarter numbers look “atrocious.”

Get local stories you won't find anywhere else right to your inbox.
Sign up here

Just Posted

107 new cases of COVID-19 in Alberta, 5 additional deaths

More than 1,000 cases in Alberta total

Municipal projects face COVID-triggered delays

Pandemic safety measures expected to impact construction schedules

Red Deer trucker ‘nervous’ on front lines of COVID-19 fight

Patrick O’Connor is just looking for some help for the common man.… Continue reading

Gardening for food during COVID-19

“Gardening is easy, and there’s always Google”

Alberta Health Services provides COVID-19 prevention tips

Alberta Health Services has a number of recommendations for people amid the… Continue reading

Alberta government website has latest COVID-19 statistics

Red Deer Advocate readers can stay up to date on the COVID-19… Continue reading

Former Obama security adviser calls on Canada to show global COVID-19 leadership

Former Obama security adviser calls on Canada to show global COVID-19 leadership

Campaigning in a time of crisis: Tory leadership candidates carry on

Campaigning in a time of crisis: Tory leadership candidates carry on

‘Thirsty, hungry, injured:’ Two women sentenced for abuse of girls in basement

‘Thirsty, hungry, injured:’ Two women sentenced for abuse of girls in basement

Alberta environmentalists oppose possible crane, swan hunting season

Alberta environmentalists oppose possible crane, swan hunting season

‘Always new expenses:’ Lawsuits filed as anniversary of Broncos bus crash nears

‘Always new expenses:’ Lawsuits filed as anniversary of Broncos bus crash nears

Pandemic forcing NBA players to work out with what’s on hand

Pandemic forcing NBA players to work out with what’s on hand

Most Read