Canada’s economy posted no growth in this year’s second quarter after expanding by 0.6% in the previous first quarter, data released by Statistics Canada shows.
The stagnant growth in gross domestic product (GDP) during Q2 was blamed on declines in housing investment, smaller inventory accumulations, as well as decreases in international exports and household spending.
The federal agency also revised down its reading for economic growth in this year’s first quarter to an annualized pace of 2.6%, which is lower than a previous estimate of 3.1%.
Statistics Canada said that housing investment fell 2.1% in Q2, the fifth consecutive quarterly decline. The decrease was led by a sharp drop in new construction (down 8.2%), which was seen in every province except Nova Scotia.
Imports of goods and services rose 0.5% in Q2, following a 0.2% increase in this year’s first quarter. However, exports from Canada slowed to an increase of 0.1% in Q2 following a 2.5% increase in Q1.
Growth in household spending slowed to 0.1% in this year’s second quarter from 1.2% in Q1, said the federal agency.
On a positive note, compensation among employees rose 2.2% in Q2, higher than the 1.9% advance seen in the previous quarter.
Household disposable income increased by 2.6% across Canada in Q2, a reversal from a 0.6% decline in the previous first quarter.
However, Statistics Canada noted that corporate incomes declined for the fourth consecutive quarter between April and June of this year, continuing a downward trend that began in late 2022.
