Canada GDP Contracts 0.1% in Q1

The Canadian economy shrank 0.1 percent on quarter in the first three months of 2015, compared to a 0.6 percent growth in the previous period. This was the first contraction since the second quarter of 2011 as domestic demand, business investments and exports declined.
Statistics Canada | Joana Ferreira | 5/29/2015 2:15:34 PM
Final domestic demand fell 0.4 percent after increasing 0.4 percent in the previous quarter. Household final consumption expenditure rose 0.1 percent, the smallest gain since the second quarter of 2012. Increased outlays on semi-durable and non-durable goods more than offset decreased spending on durable goods. Growth in expenditures on services slowed to 0.1 percent. Government final consumption expenditure was 0.2 percent lower.

Business gross capital formation was down 2.5 percent, driven by a 4.1 percent decrease in non-residential structures and machinery and equipment. On the other hand, business investment in residential structures was up 1.0 percent, led by an increase in new home construction. Businesses added CAD 11.6 billion to their inventories in the first quarter, up from CAD 8.5 billion in the previous quarter. Wholesalers increased their inventories of durable goods by CAD 7.1 billion.

Exports of goods and services decreased 0.3 percent, following a 0.4 percent decline in the previous quarter. Exports of goods declined 0.5 percent, while services increased 0.8 percent. Imports of goods and services fell 0.4 percent.

The mining, quarrying and oil and gas extraction sector posted a notable decrease in the first quarter, as a result of a 30 percent decline in support activities for mining and oil and gas extraction. Construction, wholesale trade and manufacturing posted notable declines as well. There were also decreases in accommodation and food services, transportation and warehousing services and in the output of real estate agents and brokers. On the other hand, the finance and insurance sector, utilities as well as the agriculture and forestry sector increased in the first quarter. The public sector and professional services also advanced.

Expressed at an annualized rate, real GDP contracted 0.6 percent in the first quarter.

Canada GDP Contracts 0.1% in Q1