Canadian real GDP falls by 1.4% in first quarter

June 1, 2009 11:41 p.m.

Statistics Canada released first quarter real GDP data which shows that the real GDP fell in the first quarter by 1. 4% or 5.4% on an annualized basis.This was the biggest decline since the 1991 recession but slightly better than what analysts expected. This fall compares with a 5.7 % drop in U.S.real GDP in the first quarter. Corporate profits fell by 24 % in the first quarter roughly what they fell by in the last quarter of 2008. Prices of goods and services produced in Canada fell by 1.7 % following a drop of 2.9 % in the last quarter of 2008. Export prices fell 6.7 %, much more than the drop in import prices, -1.6 %.
Investment in residential structures fell by 5.7 % largely because of the drop in house construction.Non farm inventories were also drawn down in the quarter indicating the depth of the slowdown.Business investment in the crucial sector of machinery and equipment fell by 11 %.


The picture thus while slightly better than the last quarter is still that of an economy suffering a deep recession. The good news is that it may have bottomed and as the stimulus works itself through the economy we may in the next quarter begin to see significant improvements in these numbers.

In Europe, Eurozone unemployment rose to 9.2 % with Spain now suffering 17.4 %(a slight improvement from last month based on the latest national data) and Germany 7.7 % , France 8.9 %, Italy 6.9 %, Belgium, 7.5 %, U.K. 6.9%, the Netherlands 3.0 %,Greece 7.8 %, Denmark 5.5 %,Sweden 8.5 %,Austria, 4.2 %, Ireland 11.1 %,Poland 7.8 % and Portugal 9.3 % unemployment.

(all data courtesy of Eurostat)