Canada’s economy seen up 0.8% in February, 0.2% in January

March 31, 2022

By Julie Gordon

OTTAWA (Reuters) – The Canadian economy gathered considerable momentum in February, growing for a ninth consecutive month and following a January gain that met expectations, data from Statistics Canada showed on Thursday.

Real gross domestic product likely grew 0.8% in February, led by increases in manufacturing and resources, Statscan said in a flash estimate. The economy expanded 0.2% in January, matching analyst expectations, on strength in the goods sector.

With February’s gain, Canada’s economy is now 1.2% above pre-pandemic levels, Statscan said. That strength will add to pressure on the Bank of Canada to move aggressively on rate hikes when it meets in mid-April.

Services were flat in January as the spread of the Omicron variant of the coronavirus led to more restrictions, slamming accommodation and food services, though the February flash estimate suggested a partial reversal for those subsectors.

Retail climbed, led mostly by motor vehicles and parts, as an earlier rebound in car imports injected much-needed supply onto dealer lots, Statscan said. Building materials and home furnishings also surged.

Statistics Canada revised upwards the December GDP growth rate to 0.1% from flat.

(Reporting by Julie Gordon in Ottawa, additional reporting by Dale Smith; Editing by Bernadette Baum)