Canada’s Economy Stalled in February in Early Stages of Virus
(Bloomberg) -- Canada’s economy slid to a halt in February as the Covid-19 outbreak abroad dampened global growth.
Gross domestic product was unchanged from January, missing economist estimates for a 0.1% gain, Statistics Canada reported Thursday. That follows a 0.2% jump in the prior month.
Thursday’s numbers don’t provide much insight into the trajectory of the economy since conditions rapidly deteriorated in March when strict social distancing measures took effect. March GDP numbers to be released next month will likely offer greater insight into the extent of the virus on the economy.
- The report shows that the Canadian economy was slowing even before the pandemic really hit. Things will get much worse, with Statistics Canada already releasing a “flash” GDP report for March that showed a 9% decline during the month, and a 2.6% for the first quarter as a whole.
- Rail blockades and labor strikes at schools disrupted economic activity in February with contractions in both the transportation and warehousing sectors and educational services industry
- Excluding the education and transportation sectors, the economy would have posted a 0.2% gain with 13 of 20 sectors increasing
- Initial impacts of Covid-19 were noticeable in the air transport sector which was down 2.6% in Feb.
- Accommodation and food services were also impacted by the outbreak, Statistics Canada said
- The real estate sector was a major contributor to growth, jumping 5.9% in February
- On an annual basis, GDP rose 2.1%
- In a separate release, the agency said the number of payroll employees declined 35,000 in February, led lower by losses in the wholesale trade sector. That’s already the fastest monthly decline since 2015.
- Wages were up 3.7% from a year earlier.
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