StatCan says GDP grew 0.2 per cent in January 2022
Growth through the remainder of the year is likely to be slower because of the impact of high inflation on household finances.
Statistics Canada says real gross domestic product grew 0.2 per cent in January, a month marked by restrictions due to a surge in COVID-19 cases.
Goods-producing industries drove gains in January, with the agency noting the construction sector grew for the third time in four months and the largest monthly gain in wholesale trade since July 2020.
Residential construction grew 4.3 per cent in January, which Statistics Canada noted more than offset the previous two months of contractions and was the largest monthly gain since March 2021.
The same couldn’t be said for the service sector that as a whole registered zero growth in January.
Accommodation and food services, and the arts, entertainment and recreation sector each saw their largest monthly declines since the first wave of the COVID-19 pandemic in April 2020.
The agency says its initial estimate suggests the economy grew 0.8 per cent in February, saying that many of the sectors down in January rebounded a month later.
Statistics Canada will finalize the February figure at the end of April.
Royce Mendes, managing director and head of macro strategy at Desjardins, says after plugging away through January, the economy looks to have hit the accelerator in February as services were buoyed by the fading of Omicron and restrictions being relaxed.
He says the early figure for February amounts to solid growth.
CIBC senior economist Andrew Grantham says the surprisingly resilient January figure and early estimate for growth in February puts economic growth for the first quarter ahead of what he — and the Bank of Canada — anticipated at the start of the year.
But Grantham says growth through the remainder of the year is likely to be slower because of the impact of high inflation on household finances, potential supply chain issues stemming from Russia’s unprovoked invasion of Ukraine, and higher interest rates slowing the boom in the housing market.