Canadian Economy Remains Afloat Despite Restrictions

The GDP of Canada increased by 9.6% in Q4 of last year

Skerdian Meta•Tuesday, March 2, 2021•1 min read

The coronavirus restrictions returned in Canada in December, but the economy seems to be keeping the pace of expansion despite that. The GDP increased by 0.1%, which is not much but at least it didn’t turn negative again like in Europe. The Q4 GDP in total came quite strong nonetheless, at 9.6%.

Q4 GDP % QoQ annualized +9.6% vs +7.3% expected
Q3 GDP QoQ final number was +40.3% annualized
December GDP MoM +0.1% vs +0.1% expected
December GDP YoY -3.0% vs -3.0% expected
November GDP YoY was -2.8%
November GDP MoM was +0.8%
January GDP flash estimate +0.5%
18 of 20 sectors grew in Q4
Full report

The annualized number is much stronger but the December data is in line. Total activity is 3% below pre-pandemic levels. Retail trade was down 3.3% in December as governments put on lockdowns right after Christmas but even non-store retail (online) was down 1.1% in the month due to the secular move towards earlier Christmas shopping.

The big surprise to me is the January flash estimate, up 0.5% in a month of heavy lockdowns across the country. That bodes well for 2021 growth. USD/CAD is slightly higher in the aftermath but that’s part of a broader move in markets. This is a good report.

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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.