GDP contracted 0.1% in November

Overall contraction in the economy came despite gains in 13 of the 20 industrial sectors tracked

The Canadian economy weakened in November as the wholesale trade and manufacturing sectors pulled back.

Statistics Canada said Thursday real gross domestic product fell 0.1 per cent in November following an increase of 0.3 per cent in October.

The report was in line with estimates that the contraction would be 0.1 per cent for the month, according to Thomson Reuters Eikon.

Benjamin Reitzes, Canadian rates and macro strategist at BMO Capital Markets, said the report changes little for the Bank of Canada, but reinforces that they’ll be extremely patient with policy.

“The Canadian economy had a tough stretch through the latter stages of 2018, and the oil production cuts will make the early 2019 data look soft as well,” Reitzes wrote in a report.

“However, this weakness is fully expected, with fourth quarter and first quarter growth forecasted to average about one per cent.”

The Bank of Canada kept its key interest rate target on hold at its last rate announcement. In making its decision, the central bank noted that the drop in oil prices at the end of last year will weigh on the economy, but predicted that the effects of the slump will dissipate and allow growth to resume.

READ MORE: B.C. home sales to slide 23% this year, rise next year: real estate group

Fotios Raptis, senior economist at TD Bank, said further weakness in the oil sector is expected to continue to weigh on overall growth as Alberta’s mandatory production cuts took effect in January.

“The temporary slump in the oil sector, combined with elevated global economic uncertainty warrants patience on behalf of the Bank of Canada,” Raptis wrote in a report.

The overall contraction in the economy came despite gains in 13 of the 20 industrial sectors tracked.

The wholesale trade sector fell 1.1 per cent in November as machinery, equipment and supplies wholesaling pulled back 2.1 per cent.

The manufacturing sector also contracted 0.5 per cent for the month, the third decline in four months.

The mining, quarrying and oil and gas extraction sector fell 0.1 per cent as mining excluding oil and gas extraction and supporting activities were more than offset by a drop in oil and gas extraction.

Mining excluding oil and gas extraction grew 2.3 per cent, while oil and gas extraction fell 1.6 per cent.

Conventional oil and gas extraction fell 2.2 per cent, while non-conventional oil extraction dropped 0.9 per cent.

The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

Unplowed Roads parody song destined to be a classic

Move over Weird Al, Island elementary students on the same level

Watershed concerns prompt opposition to alternate Malahat routes

Motion submitted to Regional Water Supply Commission opposing highway in watershed

Vancouver measles outbreak prompts vaccine vigilance on Island

No cases here yet, but Island health authorities push measles vaccinations - and not just for kids

Robert Barron column: Thanks to municipal workers during snow storm

I’ve always wondered how anything gets done when mounds of snow fall from the sky.

Island fossil makes it to the top of the provincial list

Courtenay’s elasmosaur will be added to the official Provincial Symbols of British Columbia

‘Riya was a dreamer’: Mother of slain 11-year-old Ontario girl heartbroken

Her father, Roopesh Rajkumar, 41, was arrested some 130 kilometres away

CRTC report finds ‘misleading, aggressive’ sales tactics used by telecom industry

Report recommends measures to make a fairer situation for consumers

Trudeau takes personal hit amid SNC-Lavalin controversy: poll

Overall, 41 per cent of respondents believed the prime minister had done something wrong in the affair

B.C. photographer captures otters on ice

A Langley photographer was at the right place at the right time on the Fraser River

Snow not melting fast enough for some Greater Victoria residents

Resident unhappy with lack of snow removal on Mount Doug trails

‘Priceless’ hat stolen from Indigenous art store in Campbell River during break-in

Ernie Smith, co-owner of Awatin Aboriginal Art, looking for help in recovering stolen hat

Mid-Island dealing with high interest in backyard cannabis production

Regional District of Nanaimo reports dealing with rising desire for small-scale grows

North Cowichan to pause all logging in forest reserve for 2019

Municipality expects decision to cause $150,000 shorfall this year

UPDATED: Langford homes evacuated after water main break

Break at the corner of Goldstream Avenue and Strathmore Road, several homes without water

Most Read