Real GDP Declined 0.3% in April – Statistics Canada
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Statistics Canada said the economy contracted in April as real gross domestic product posted its first decline since April 2020 during the first wave of the pandemic.
Real GDP declined 0.3% in April, following 11 straight months of gains. Although economists polled by Bloomberg forecast a contraction of 0.8%, Canada’s economic activity is still 1% below pre-pandemic levels of February 2020.
According to Statistics Canada, 12 of the 20 industrial sectors reported declines, as a contraction in services-producing industries more than offset the 0.5% increase in goods-producing industries.
The decline in April and the early estimate for May put overall economic activity about one percent below pre-pandemic levels seen in February 2020.
The retail trade sector noted a 5.5% decrease in April, as some key provinces reinstated pandemic restrictions in wake of a third wave of Covid-19 cases. The clothing and clothing accessories sector noted a 21% decline, while the building material and garden equipment and supplies reported a 7.9% decrease. Similarly, the accommodation and food services sector fell 4.6% in April.
In the meantime, Canada’s construction sector increased 2.4% in April, marking the fifth consecutive month of gains.
The majority of the expansion in this category stemmed from the residential building construction subsector, which jumped 4.1% amid continued growth in single-family dwellings. On the other hand, however, the real estate, rental, and leasing sector declined 0.7%, down for the first time since October of last year as real estate activity across key urban centres slowed down.