Tuesday, April 5, 2005

Steady economic growth

THE ECONOMY grew for the third straight month in January, but declines in output in construction, wholesaling and utilities slowed the advance.

Gross domestic product by industry rose 0.2% for the second consecutive month, following a 0.3% gain in November.

Construction cooled because of a second consecutive monthly decline in single-detached dwellings and a slowdown in the building of institutional and commercial structures. New housing starts in urban areas posted double-digit declines across the country.

Relatively mild weather across much of the country in January led to lower output in utilities and lower demand for petroleum and natural gas. Wholesale output fell, pulled down mainly by lower activity in motor vehicles.

On the plus side, retail sales rebounded in January after falling in December, largely because consumers cashed in gift cards they got for Christmas. Beer, wine and liquor store sales made up some of the ground lost in the previous three months.

Solid growth in manufacturing

Manufacturing geared up for the second consecutive month, led by solid growth in the aerospace products and parts industry. The increases in manufacturing were widespread as 15 of the 21 major groups posted gains.

Demand for heavy trucks surged in January in response to bottlenecks in the transportation of goods by rail and water in 2004.

Oil and gas extraction edged down because of continued production difficulties in the Alberta tar sands. Potash production posted a double-digit decline following a strong December. Diamond output picked up after two months of sharp declines.

For further information, contact Bernard Lefrançois (613-951-3622), Industry Measures and Analysis Division.

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© 2004, 2005 Statistics Canada.