The FINANCIAL — Canada’s economy shrank for the fourth-straight month in April as slumping crude-oil prices continued to weigh on the economy, according to Nasdaq.
Gross domestic product, or the broadest measure of goods and services produced in the economy, fell 0.1% in April from the previous month, Statistics Canada said, following a 0.2% decline in March. Market expectations were for a 0.1% increase in April, according to economists at Royal Bank of Canada.
April’s reading was closely watched, given that it kicked off the second quarter, a period widely expected to show signs of recovery in the Canadian economy after it took a hit from sharply lower oil prices in the first quarter. GDP fell 0.6% on an annualized basis in the first three months of 2015 as business investment plunged in response to slumping crude-oil prices.
“The slight fall in GDP in April, coupled with the weak handoff from the prior quarter, leaves us facing the probability that Q2 GDP could also be negative,” CIBC World Markets Inc. said in a note.
The Canadian dollar edged lower after the data were released at 8:30 a.m. EDT, and was worth about 80.6 U.S. cents compared with 80.7 U.S. cents at Monday’s close.
Statistics Canada said mining, quarrying and oil-and-gas extraction contracted 2.6% in April, marking the sixth- consecutive month of declines. Wholesale trade rose 1.6% in the month, while manufacturing output fell 0.2%.