Canadian Economy Grows, But Shows Signs of Slowing - Modern Distribution Management

Log In

Canadian Economy Grows, But Shows Signs of Slowing

Wholesale trade in Canada was the fastest growing industry for the country in the fourth quarter 2007, according to a recent report from Statistics Canada. The sector saw 9% growth, reflecting an 11% gain in the volume of imports. Manufacturing grew 1.2%.
 
Overall, the Canadian economy performed well in the fourth quarter 2007, thanks in part to an exchange rate above parity with the U.S. dollar. Output growth was steady in October, while employment rose 0.8% despite a softening in December.


Still, according to the report, there are signs that the economy could slow at the beginning of 2008. The composite leading index decelerated in the last three months of 2007, mostly due to weak U.S. demand ...
Author
Date

Wholesale trade in Canada was the fastest growing industry for the country in the fourth quarter 2007, according to a recent report from Statistics Canada. The sector saw 9% growth, reflecting an 11% gain in the volume of imports. Manufacturing grew 1.2%.
 
Overall, the Canadian economy performed well in the fourth quarter 2007, thanks in part to an exchange rate above parity with the U.S. dollar. Output growth was steady in October, while employment rose 0.8% despite a softening in December.

Still, according to the report, there are signs that the economy could slow at the beginning of 2008. The composite leading index decelerated in the last three months of 2007, mostly due to weak U.S. demand for manufactured goods. This slack was offset by continued buoyant gains in consumer spending and housing in Canada.

Overview of 4Q

From January to October 2007, year-over-year growth in real gross domestic product accelerated from 1.8% to 2.8%. All industries expanded, except the primary sector (where incomes still remained high thanks to buoyant prices for oil, metals and grains).

Wholesale trade was the fastest growing industry, up 9%, reflecting an 11% gain in the volume of imports. Retailers were next at 6%, followed by construction and a slew of personal and business services, growing between 3% and 4%.

Manufacturing was up 1.2%, a major reversal from a drop of nearly 4% at the start of 2007. Capital goods and automobiles led this turnaround, while the clothing and forestry-related sectors continued to post hefty losses.

 
The stronger Canadian dollar has insulated Canadians from the worldwide upsurge in food prices in the past 12 months. Driven by higher prices for grains and corn, food inflation in the euro zone was 4.3% in November, 5.1% in the United Kingdom and 5.4% in the U.S. In Canada, the cost of groceries was up only 0.6%.

By Province
British Columbia’s economy remained strong in recent months. Shipments in October recorded their strongest gain since April (+1.9%), led by metals, machinery, chemical products and paper. The province remained busy in the run up to the Olympic Games. Employment rose 1.1% in November, due to increases in construction, transportation and recreation, reflecting the ongoing construction of ski resorts and the Olympic village.

Manufacturing was also a source of growth in Quebec. After a weak third quarter, shipments rebounded in October, led by the sharpest rise in transportation equipment since March. Quebec’s aerospace industry is in full flight, shipping $1.3 billion more between January and October 2007 than in the same period in 2006, setting a new record. The rebound in this industry was due to major export orders; in October, it moved into first place in provincial exports, ahead of aluminum, as a result of sales to the U.S. and to the United Arab Emirates.

In Ontario, non-residential construction continued strong in October with permits remaining close to the $1-billion mark. Its 31.5% increase from January to October 2007, fuelled by office building projects, led the country, ahead of Alberta’s 24.4% jump. This rebound occurred as Ontario posted its strongest increase in service sector employment since 2003. Housing also remained close to the highs posted in 2007.

Share this article

About the Author
Recommended Reading
Leave a Reply

Leave a Comment

Sign Up for the MDM Update Newsletter

The MDM update newsletter is your best source for news and trends in the wholesale distribution industry.

Get the MDM Update Newsletter

Wholesale distribution news and trends delivered right to your inbox.

Sign-up for our free newsletter and get:

  • Up-to-date news in a quick-to-read format
  • Free access to webcasts, podcasts and live events
  • Exclusive whitepapers, research and reports
  • And more!

2

articles left

Want more Premium content from MDM?

Subscribe today and get:

  • New issues twice each month
  • Unlimited access to mdm.com, including 10+ years of archived data
  • Current trends analysis, market data and economic updates
  • Discounts on select store products and events

Subscribe to continue reading

MDM Premium Subscribers get:

  • Unlimited access to MDM.com
  • 1 year digital subscription, with new issues twice a month
  • Trends analysis, market data and quarterly economic updates
  • Deals on select store products and events

1

article
left

You have one free article remaining

Subscribe to MDM Premium to get unlimited access. Your subscription includes:

  • Two new issues a month
  • Access to 10+ years of archived data on mdm.com
  • Quarterly economic updates, trends analysis and market data
  • Store and event discounts

To continue reading, you must be an MDM Premium subscriber.

Join other distribution executives who use MDM Premium to optimize their business. Our insights and analysis help you enter the right new markets, turbocharge your sales and marketing efforts, identify business partners that help you scale, and stay ahead of your competitors.

Register for full access

By providing your email, you agree to receive announcements from us and our partners for our newsletter, events, surveys, and partner resources per MDM Terms & Conditions. You can withdraw consent at any time.

Learn More about Custom Reports

Request a Market Prospector Demo

  • This field is for validation purposes and should be left unchanged.