OTTAWA – According to Statistics Canada, the economy grew at an annual rate of 5.6 percent in the first quarter of the year.
The figure for the first three months of the year is better than the contraction forecast a few months ago, but still represents a slowdown from the 9.6% annualized growth seen in the last three months of 2020.
The economic recovery has been aided by the easing of public health restrictions which have contributed to the increase in the goods and services production sectors.
The statistics agency said the quarter ended with a 1.1% increase in real gross domestic product in March, after the 0.4% recorded in February.
Construction increased for the third quarter in a row, driven by single-family home construction and renovations as Canadians look to upgrade their homes or find more space.
Statistics Canada notes that public sector output contributed the most to growth in service-producing industries in the first quarter, including health care.
At the end of the quarter, Statistics Canada reports that overall economic activity was 1% below levels seen before the pandemic in February 2020.
Statistics Canada also estimates that the second quarter started with a stumble, with economic output falling 0.8% for April, which would be the first drop since April 2020.
The agency says April’s decline would leave overall economic activity about 2% below pre-pandemic levels in February 2020.
CIBC chief economist Avery Shenfeld writes that investors are already looking beyond the remainder of the second quarter, hoping vaccinations will pave the way for stronger growth in the second half.
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