Canada: Housing driving economic growth

Gross Domestic Product (GDP) growth stalled in February, showing 0% growth, with new figures from Statistics Canada revealing that Canada relied heavily on its housing boom.

Statistics Canada data showed that goods-producing industries saw a downturn in February, declining by 0.3%, while housing related industries including construction, finance, insurance and real estate all saw gains of between 0.5-0.7%, preventing the economy from contracting.

Housing related industries including construction, finance, insurance and real estate all saw gains of between 0.5-0.7%, preventing the economy from contracting.

The slowdown was in line with economist expectations following strong performance at the end of 2016 and in January 2017.

Despite performing as expected overall, the uneven industry performance has raised concerns that Canada is too dependent on housing for growth, with David Madani of Capital Economics noting that the Bank of Canada is unlikely to raise rates until Canada’s economic growth is more balanced.

 

Upcoming Events
07
Oct
20
Australian Banking Innovation Summit 2020
The Rocks, NSW, Australia
See all upcoming events
map4
Subscribe to receive insights delivered straight to your inbox
Latest news, unbiased expert analysis and insights across banking and finance