Is Canada’s December Data Signalling Another Recession?
Canadian wholesale sales posted a decline for December
Skerdian Meta•Friday, February 12, 2021•1 min read
The economy of Canada was recovering well in summer last year, after the spring lock-downs ended. But, it was showing signs of weakness in early Autumn, while the weakness grew further as the restrictions also increased in November. December is looking to be worse, with wholesale sales taking a dive. January is expected to be worse, so we might see another recession in Canada, just like in Europe.
Canada December wholesale sales and inventories
- December wholesale sales -1.3% vs -1.7% expected
- Prior was +0.7%
- First decline after seven months of gains
- Inventories -0.1% vs -0.6% prior
- Inventories -1.7% y/y
- Sales in five of the seven sub-sectors were higher than the pre-COVID-19 benchmark, led by building material and supplies (+12.2%), and machinery, equipment and supplies (+6.6%)
- Motor vehicle and motor vehicle parts and accessories sales fell for the second consecutive month, down 4.3%
Inventory building looks like it will be a positive contributor to Canadian GDP in the first half of the year with inventories at the lowest levels since 2019. Some of that is surely shortages so sorting out the timing isn’t straightforward. USD/CAD has bounced back to 1.2745 today after a failed break of 1.2650 yesterday.
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Skerdian Meta
Lead Analyst
Skerdian Meta Lead Analyst.
Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.
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