Economy

Canada’s economy seen growing in January after strong fourth quarter

Published

3 years ago

March 1, 2022

The Canadian economy mostly likely started 2022 on a strong footing, despite the impact of the Omicron variant of the coronavirus, while fourth-quarter growth came in above expectations, official data showed on Tuesday.

Canada’s economy grew 6.7% in the last three months of 2021 on an annualized basis, beating analyst forecasts of 6.5%, while gross domestic product in January most likely rose 0.2% after stagnating in December, Statistics Canada data showed.

With January’s gain, which is a preliminary estimate, economic activity is now 0.6% above pre-pandemic levels, Statscan said.

“While the clouds darkened a bit before the end of the year … GDP posted a surprising 0.2% advance in January despite the Omicron wave and all of the associated job losses,” said Royce Mendes, head of macro strategies at Desjardins Group.

“The economy likely built on that momentum in February, as the latest COVID wave turned a corner, which allowed for more reopenings across the country,” he added.

The strong fourth-quarter print came in above the Bank of Canada’s own forecast in January of a gain of 5.8%. The Canadian central bank is broadly expected to raise its key interest rate to 0.50% when its meets on Wednesday.

With the Canadian economy strong and set to be boosted by higher oil prices, the central bank is unlikely to change course on its signaled increases even amid increased uncertainty following Russia’s invasion of Ukraine, economists said.

“So far I don’t see the war in Ukraine as being enough to derail those prospects, and so I expect we’ll hear the Bank of Canada guide that they are on the path toward a series of hikes tomorrow,” said Derek Holt, vice president of Capital Markets at Scotiabank.

Canada’s economy grew 4.6% in 2021, in line with Canadian government forecasts for the year.

The Canadian dollar was trading nearly unchanged at 1.2679 to the greenback, or 78.87 U.S. cents.

(Reporting by Julie Gordon in Ottawa and Ismail Shakil in Bengaluru and additional reporting by Fergal Smith in Toronto; Editing by Edmund Blair, Andrea Ricci, Jonathan Oatis and Paul Simao)

Economy

PBO projects deficit exceeded Liberals’ $40B pledge, economy to rebound in 2025

Published

13 hours ago

October 17, 2024

Anne Joseph

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.

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Economy

Statistics Canada says levels of food insecurity rose in 2022

Published

1 day ago

October 16, 2024

Anne Joseph

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.

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Economy

Statistics Canada says manufacturing sales fell 1.3% to $69.4B in August

Published

2 days ago

October 16, 2024

Anne Joseph

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.

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