OTTAWA — The world is coming out of the recession but it’s the United States, not Canada, that appears to be one of the countries leading the charge.
Canada’s economy suffered a confidence-sapping setback during the summer, when gross domestic product actually shrank 0.1 per cent in August, the first outright decline since May.
Following a flat July, August’s data could result in a negative third quarter — barring a stronger September — meaning that in a technical sense, the recession has yet to end months after it was declared over.
Even worse, the retreat was widespread, led by the critical goods production sectors including manufacturing, oil and gas extraction and mining.
Compare that with the U.S. reporting Thursday that its GDP shot forward 3.5 per cent in the third quarter. Economists say it is now impossible for Canada to come close to matching its southern neighbour when third-quarter numbers are tabulated.
Canada is also almost certain to fall well short of the Bank of Canada’s projection, made only last week, of two per cent growth for the July-September period, said Scotiabank economist Derek Holt.
That would mean the U.S. has bettered Canada the last two quarters.