OTTAWA (Reuters) - The Canadian economy grew by 0.2 percent in February from January, meeting economists’ expectations but recovering only modestly from December’s weather-induced decline, Statistics Canada data showed on Wednesday.
In December, the economy contracted by 0.4 percent (revised from 0.5 percent), and in January it expanded by 0.5 percent. Production in February was only 0.3 percent higher than it was three months earlier in November, before a harsher-than-usual winter took a toll on the economy.
Nonetheless, TD Securities macro strategist David Tulk said first-quarter growth was tracking at an annualized 1.7 to 1.9 percent, stronger than the Bank of Canada’s forecast this month of 1.5 percent. His projection assumes March growth of 0.2 percent from February.
U.S. first-quarter growth came in on Wednesday at only 0.1 percent annualized, suggesting that it was not a banner quarter for Canadian exporters.
February’s gains in Canada were led by the mining and oil and gas industries. Mining and quarrying rose 4.8 percent, particularly because of copper and nickel, and oil and gas extraction rose by 0.7 percent, mainly because of higher natural gas production.
The agriculture and forestry sector declined 1.5 percent, principally because of expectations of lower crop production after last year’s record harvest. The figures are adjusted for seasonal factors, and while Canadian crop production in raw numbers is close to zero in February, Statscan looks at farmers’ planting intentions to assign a seasonally adjusted number.
Manufacturing rose 0.6 percent after gaining 1.6 percent in January, and goods production was up 0.5 percent. Services rose 0.1 percent.
Editing by Meredith Mazzilli; and Peter Galloway