Canada’s economy grew at an annualized rate of 1.7% in the year’s first quarter after registering growth of 0.1% in the final months of last year.
On a sequential quarter-over-quarter basis, Statistics Canada said that gross domestic product (GDP) in Canada increased 0.4% in the first three months of the year after posting no change in the fourth quarter of 2023.
The federal agency added that the country’s economy registered no growth in March of this year after growing 0.2% in February.
A preliminary estimate for the economy in April indicates month-over-month growth of 0.3%.
Higher household spending on services was the main contributor to the increase in Q1 GDP, helping to offset slower inventory accumulations.
Household spending increased 0.7% in the year’s first quarter, primarily due to a 1.1% rise in spending on telecommunications, rent, and air travel.
Canada’s exports rose 0.5%, driven by shipments of precious metals such as gold and silver whose prices are currently at record highs.
Imports increased 0.4% led by clothing and footwear. That offset a decline in motor vehicle imports.
Business capital investment rose 0.8% in the first quarter, while housing investment edged up 0.3% due to a rise in residential resale activity across the country.
Additionally, Statistics Canada reported that household savings rates reached 7% in Q1, the highest level since the first quarter of 2022, fueled by higher disposable incomes (up 1.8%).
Lastly, corporate incomes in Canada declined 4.9% in the January through March quarter after rising 2.4% in the previous fourth quarter of 2023.
The lower corporate incomes were due to a decrease in the oil and gas sector, where price declines for crude led to reduced incomes for energy companies.
