Canadian economy grew 0.2 per cent in April compared with an increase of 0.5 per cent in March, according to the latest figures released by Statistics Canada.
The growth was driven by service-producing industries that grew by 0.3 per cent. Goods-producing industries were essentially unchanged as growth in mining, quarrying, and oil and gas extraction was largely offset by a drop in manufacturing.
Fourteen out of 20 economic sectors grew in April, Statistics Canada said.
“Coming off a scorching March, a milder April still keeps Canadian output extending an impressive run for growth,” said Nick Exarhos, an economist with CIBC. “A 0.2 per cent gain in monthly GDP comes despite production outages at a key oil sands facility, the return of which we’ll see in May.”
There was also further evidence of recovery in the energy sector, supporting Bank of Canada governor Stephen Poloz’s contention that adjustment to lower oil prices is largely complete, said RBC economist Josh Nye.
Canada’s obsession with hockey drove a 2.8-per-cent growth in the arts, entertainment and recreation sector for the fourth time in five months.
“The increase was primarily the result of a 7.0 per cent gain in performing arts, spectator sports and related industries, and heritage institutions, as five Canadian teams took part in the first round of the National Hockey League playoffs in April and strong professional basketball and baseball attendance continued,” said the Statistics Canada report.
The latest economic report comes amid increased speculation that the central bank could raise its key interest rate target next month.
Poloz has repeated in recent days that interest rate cuts made in 2015 have done their job and noted that the economy enjoyed surprisingly strong growth in the first quarter of the year.
“Canadian growth is slowing from a blistering end to last year and start of 2017, but is still in healthy enough territory to chew up what’s left of economic slack,” said Exarhos. “Indeed, the economy is slated to reach full employment before the end of the year, reason enough for the Bank of Canada to deliver a rate hike in the coming months.”
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