Canadian Real GDP Contracts 0.2% in November

On Friday, Statistics Canada (StatCan) reported that real gross domestic product (GDP) decreased 0.2% in November, the largest monthly contraction since December 2023, following a 0.3% increase in October. Overall, economic activity declined broadly in November, with 13 of 20 sectors lower.

Goods-producing industries shrank 0.6%, partially offsetting the 0.9% growth recorded in October. The decline was largely driven by mining, quarrying, and oil and gas extraction, as well as utilities.

After five consecutive months of growth, services-producing industries edged down 0.1% in November. The transportation and warehousing sector was the largest contributor to the decline, largely due to work stoppages. However, increased activity in real estate and rental and leasing helped temper the overall downturn.

The construction sector grew 0.7% in November, continuing an upward trend that began in August. Growth was driven by increased activity in both residential and nonresidential building construction. Residential construction rose 1.8%, marking a fourth consecutive monthly gain, supported by single-family home construction and home renovations. Nonresidential construction increased 1.3%, fueled by higher activity in industrial and public projects.

December GDP Projections

According to preliminary data from StatCan, real GDP by industry grew 0.2% in December. Gains in retail trade, manufacturing, and construction were partially offset by declines in transportation and warehousing, real estate and rental and leasing, and wholesale trade. This advance estimate will be updated on February 28 when the official GDP by industry data for December is released.

Based on this advance estimate, real GDP by industry likely expanded 0.4% in Q4 and 1.4% for the full year. Official estimates for Q4 and the annual 2024 GDP will also be published on February 28 alongside the real GDP by income and expenditure report.