OTTAWA – The Canadian economy grew faster than expected in February, boosted by the resource industries and manufacturing.
Statistics Canada said Tuesday that the economy grew by 0.3 per cent in February, keeping pace with January which was revised upward to 0.3 per cent from 0.2 per cent.
Economists had expected February to come in at 0.2 per cent.
“February’s better-than-expected GDP growth on top of the upward revision to January means that growth in the first quarter is looking a fair bit better than we had expected,” TD Bank economist Leslie Preston wrote in a note.
“GDP growth is likely to be much closer to two per cent than the 1.6 per cent we had forecast.”
Preston said the improved growth in the first quarter was good news for an economy that had slowed to a crawl in the second half of last year.
“But it’s not time to break out the champagne just yet,” Preston added. “U.S. growth is looking a bit soft in the second quarter and we expect Canada still has a long road back to the kind of growth that would see the Bank of Canada step off the sidelines, especially with inflation remaining benign.”
Statistics Canada said mining, quarrying and oil and gas extraction were the largest contributors to the increase in real gross domestic product for February as the sector gained 2.2 per cent in the month, its fifth consecutive month of growth.
Manufacturing was up 0.8 per cent in February, following a 0.6 per cent gain in January.
Durable goods production grew 0.7 per cent, with increases in transportation equipment, non-metallic mineral products and computer and electronic products. Non-durable goods production increased one per cent.
Construction, utilities and the agriculture and forestry sectors also grew, while the output of service industries rose 0.1 per cent, mostly because of growth in arts and entertainment, the public sector and the finance and insurance sectors.
However, accommodation and food services, administrative and professional services and wholesale trade declined.