The experts promised us a “barnburner” of a first quarter for Canada’s economy, and the economy delivered.
Canada’s GDP grew at a 3.7-per-cent pace in the first three months of 2017, more than tripling the U.S.’s 1.2-per-cent pace, StatsCan reported on Wednesday. Household spending was one of the largest contributors to growth, increasing at a 4.3-per-cent pace. Auto sales were particularly strong. But, as CIBC economist Avery Shenfeld noted, consumers’ savings dropped at the same time, suggesting Canadians spent their savings to consume this quarter — a reality that can’t continue forever. Investment in residential construction helped Canada's economy grow at a breakneck speed in the first quarter of 2017. Canada’s housing boom, which seems to be on shaky ground lately, was also a major contributor. Business investment in housing grew at a 3.7-per-cent pace, more than double the 1.5-per-cent rate in the last quarter of 2016. If there was bad news to be found in the report, it was in exports, which slid 0.1 per cent on the back of a 0.5-per-cent decline in service exports. However, most analysts expect the current rapid pace of economic growth to slow in the coming quarters. A new forecast from ratings agency Moody's predicts Canada's growth for all of 2017 will come in at around 2.2 per cent, behind the U.S. and second-best among G7 countries. The “modest pace" of global economic expansion "should continue barring a negative move toward increased protectionism in the U.S.,” Moody’s said. -- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website. from http://www.huffingtonpost.ca/2017/05/31/canada-gdp-q1-2017_n_16893628.html?utm_hp_ref=canada-business&ir=Canada+Business
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