That followed a flat reading in the previous month, missing expectations for a 0.2 per cent increase in a Bloomberg survey of economists, in part due to a federal workers’ strike. March growth was revised upward to 0.1 per cent.
The economy is now on track to expand at a 1.4 per cent annualized rate in the second quarter, if June output is flat. That’s faster than the 0.8 per cent pace expected by economists in a Bloomberg survey and the Bank of Canada’s forecast of 1 per cent.
The report shows Canada’s economy continuing to defy expectations of a coming slowdown and adds to a string of firm data that already prompted an interest-rate hike in June. While consumer price gains reached the weakest pace in two years in May, the Bank of Canada may need to raise rates again to squeeze out excess demand.
Governor Tiff Macklem and his Bank of Canada officials raised borrowing costs to 4.75 per cent earlier this month after a five-month pause, saying monetary policy wasn’t sufficiently restrictive to bring supply and demand into balance. Policymakers were also worried that inflation could remain stuck above the 2 per cent target given recent economic momentum.
April’s output data, while flat, backed up some of those concerns as rate-sensitive sectors expanded. The real estate sector grew for a sixth straight month, rising 0.5 per cent, the largest growth rate since December 2020 on higher home sales. Construction activity grew 0.4 per cent, accommodation and food services rose 0.6 per cent, and retail increased 0.2 per cent.
Mining, quarrying, and oil and gas extraction also grew, jumping 1.2 per cent, in the fourth straight month of expansion. Transportation and warehousing was up 0.4 per cent.
The public sector contracted 0.3 per cent in April, the first decline since January 2022. A strike by federal workers resulted in a 4.3 per cent contraction in federal public administration excluding defense.
Wholesale trade contracted 1.4 per cent, the third consecutive monthly decline, and manufacturing declined 0.6 per cent, the first time in four months.
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.
