Statistics Canada says the pace of economic growth slowed in August as real gross domestic product grew 1.2 per cent in the month. (Matt York/THE CANADIAN PRESS/AP)
Canada’s economy grew by 1.2 per cent in August slightly higher than what economists were expecting but significantly slower than in previous months as the pace of economic recovery began losing steam.
In July, Canada’s economy had grown by 3.1 per cent, the national statistics agency said Friday.
Statistics Canada noted that August marked the fourth straight month of growth following the steepest drops on record back in March and April amid pandemic lockdowns.
The economy was expected to grow by further 0.7 per cent in September, according to Statistics Canada’s preliminary estimate.
Both goods-producing and services-producing industries were up as 15 of 20 industrial sectors posted increases and two were essentially unchanged in August, Statistics Canada said.
August saw healthy increases in the public sector, especially in education, professional services, manufacturing and construction, the data agency said.
Accommodation and food services, the hardest hit sectors by the pandemic, also continued their recovery, though at a much slower pace.
However, the mining, quarrying, and oil and gas extraction sector decreased 1.7 per cent in August, Statistics Canada said.
(Statistics Canada)
RBC economist Claire Fan said the economy has retraced around 75 per cent of the losses earlier in spring, but still sits about five per cent below February’s pre-pandemic level.
The bigger concern is how much of that third quarter growth can be sustained beyond September, Fan said.
COVID cases have been on the rise, prompting local governments to re-introduce some containment measures in hotspots, she said.
“The less stringent and more targeted response this time around probably means activity held up much better than it did back in April,” Fan wrote in a research note to clients. “But the economic rebound was already slowing ahead of the virus resurgence, and there is still clearly a risk that broader containment measures could yet be needed.”
Fan said she expects growth in activity for the industrial sector and some services industries like retail and professional services to persist beyond September.
But hospitality industries, alongside the oil and gas sector, will once again face much bigger challenges as demand weakens, she warned.
OTTAWA – The parliamentary budget officer says the federal government likely failed to keep its deficit below its promised $40 billion cap in the last fiscal year.
However the PBO also projects in its latest economic and fiscal outlook today that weak economic growth this year will begin to rebound in 2025.
The budget watchdog estimates in its report that the federal government posted a $46.8 billion deficit for the 2023-24 fiscal year.
Finance Minister Chrystia Freeland pledged a year ago to keep the deficit capped at $40 billion and in her spring budget said the deficit for 2023-24 stayed in line with that promise.
The final tally of the last year’s deficit will be confirmed when the government publishes its annual public accounts report this fall.
The PBO says economic growth will remain tepid this year but will rebound in 2025 as the Bank of Canada’s interest rate cuts stimulate spending and business investment.
This report by The Canadian Press was first published Oct. 17, 2024.
OTTAWA – Statistics Canada says the level of food insecurity increased in 2022 as inflation hit peak levels.
In a report using data from the Canadian community health survey, the agency says 15.6 per cent of households experienced some level of food insecurity in 2022 after being relatively stable from 2017 to 2021.
The reading was up from 9.6 per cent in 2017 and 11.6 per cent in 2018.
Statistics Canada says the prevalence of household food insecurity was slightly lower and stable during the pandemic years as it fell to 8.5 per cent in the fall of 2020 and 9.1 per cent in 2021.
In addition to an increase in the prevalence of food insecurity in 2022, the agency says there was an increase in the severity as more households reported moderate or severe food insecurity.
It also noted an increase in the number of Canadians living in moderately or severely food insecure households was also seen in the Canadian income survey data collected in the first half of 2023.
This report by The Canadian Press was first published Oct 16, 2024.
OTTAWA – Statistics Canada says manufacturing sales in August fell to their lowest level since January 2022 as sales in the primary metal and petroleum and coal product subsectors fell.
The agency says manufacturing sales fell 1.3 per cent to $69.4 billion in August, after rising 1.1 per cent in July.
The drop came as sales in the primary metal subsector dropped 6.4 per cent to $5.3 billion in August, on lower prices and lower volumes.
Sales in the petroleum and coal product subsector fell 3.7 per cent to $7.8 billion in August on lower prices.
Meanwhile, sales of aerospace products and parts rose 7.3 per cent to $2.7 billion in August and wood product sales increased 3.8 per cent to $3.1 billion.
Overall manufacturing sales in constant dollars fell 0.8 per cent in August.
This report by The Canadian Press was first published Oct. 16, 2024.
