Canada’s economy slowed in third quarter
OTTAWA, Nov 30, 2019 (BSS/AFP) – Canada’s economy put on the brakes in the
third quarter sending growth falling to 1.3 percent, or almost one-third of
the previous three months’ GDP, the government statistical agency said
Statistics Canada blamed a drop in exports for the slowdown, noting that
it was moderated by an uptick in consumer spending and business investment.
The agency also revised downward its second quarter gross domestic product
(GDP) figure to 3.5 percent from its initial estimate in August of 3.7
percent. This expansion was the fastest among Group of Seven industrialized
Canada’s GDP in the three months ending September 30 was in line with
With projections of a further slowing in activity toward the end of the
year, most economists believe the Bank of Canada will leave its key lending
rate unchanged at 1.75 percent when it is announced next week.
“Canada’s third quarter was another so-so result,” commented CIBC analyst
Avery Shenfeld, “with this quarter’s growth rate also in line with the
average pace we’ve seen in the past year or more.”
Interest rates, he said, were likely “low enough to offset the drag from
weak external markets.”
According to Statistics Canada, export volumes declined 0.4 percent in the
third quarter after rising 3.1 percent in the previous three months, while
recent import volumes were flat following a small drop in the second quarter.
Exports of non-metallic minerals and farm and fishing products were down,
the agency said. These declines were partly offset by higher exports of metal
ores and concentrates, and clothing and footwear products.
Increases in household spending, meanwhile, were largely driven by
purchases of new trucks, vans and sport utility vehicles.
Housing investment rose at its fastest pace in seven years, driven by both
new home construction and resales — notably in the hot real estate markets
of British Columbia and Ontario provinces.
Business investments in engineering structures, machinery and equipment
and intellectual property products were also up.