Canadian GDP grows in Feb. thanks to rebound in mining, oil and gas extraction

Oil sands mining operation.

Canada’s GDP saw largest monthly gain since May 2017

The Conference Board of Canada(CBOC) has released insights into the latest gross domestic product(GDP) statistics for Canada, which rebounded thanks to strong mining, oil and gas extraction growth in Feb., according to a press release.

Canadian real GDP rose by 0.4 per cent in Feb., representing a 3.0 per cent increase on a year-over-year basis. This is the largest monthly gain since May 2017. Growth was broad-based, with increases in 15 of 20 industrial sectors. The goods sector grew by 1.2 per cent, while the services sector grew by a modest 0.1 per cent.

The strongest contribution to growth was a rebound in mining, quarrying and oil and gas extraction, which rose by 2.4 per cent after declining 2.9 per cent in Jan.

“After a disappointing January, GDP rose 0.4 per cent in February. Some of the best news was the strength in manufacturing, which has grown over the last five months. However, the service sector growth has remained soft,” said Cory Renner, economist, The Conference Board of Canada.

Strong growth was also observed in arts, entertainment and recreation (up 1.3 per cent), manufacturing (up 1.0 per cent) and construction (up 0.7 per cent).

Manufacturing strength was led by durable manufacturing, which rose by 1.8 per cent.

By industry, the strongest increases were in fabricated metal manufacturing, non-metallic mineral manufacturing and motor vehicle manufacturing.

After declining for three straight months, retail trade creeped up a modest 0.3 per cent. The impact of softening activity in the housing resale market continues to affect real estate agents and brokers. Output in that industry fell 7.9 per cent.

With the Feb. report, first quarter GDP growth is tracking above the Bank of Canada’s latest forecast, which lends itself to a rate hike this summer, according to the CBOC.

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