Statistics Canada says economy flat in July as oil and gas sector down
OTTAWA – Economic growth in Canada stalled in July as the oil and gas sector pulled back due to a shutdown of some of Newfoundland and Labrador’s offshore production facilities for maintenance.
Statistics Canada said Tuesday the country’s real gross domestic product was essentially unchanged in July as the weakness in oil and gas extraction offset gains in service industries.
Economists had expected growth of 0.1 per cent, according to financial markets data firm Refinitiv.
“It was a mixed bag of ups and downs for the economy in July, but what seems clear is that any rebound in growth from here on out will likely only be the short-lived result of oil production returning to more normal levels,” said Royce Mendes, senior economist at CIBC World Markets.
The flat reading for July followed a second quarter that saw the economy grow at an annualized pace of 3.7 per cent, the strongest showing for a quarter in two years.
Overall, goods-producing industries fell 0.7 per cent in July, led lower by the mining, quarrying, and oil and gas extraction sector which pulled back 3.5 per cent in the month, the largest decrease in the sector since May 2016.
Oil and gas extraction fell 3.0 per cent in July as extraction excluding oilsands slipped 4.7 per cent, while oilsands extraction dropped 1.0 per cent.
The construction sector also fell 0.7 per cent in July, while the manufacturing sector edged down 0.1 per cent.
Meanwhile, Statistics Canada says the services-producing industries rose 0.3 per cent as the wholesale sector added 1.1 per cent for the month.
Wholesalers of personal and household goods grew 5.5 per cent, while motor vehicles and parts rose 3.9 per cent.