Gross domestic product up in second quarter

Québec, September 27, 2016 – Gross domestic product at market prices rose 0.2% in real terms in the second quarter of 2016, an annualized increase of 0.8%. Over the same period, a 0.4% drop was recorded in Canada, for a –1.6% downturn at the annualized rate. Compared with the first quarter of 2015, real GDP grew 1.3% in Québec and 1.0% in Canada. This was revealed in Comptes économiques du Québec, 2e trimestre 2016, a publication of the Institut de la statistique du Québec.

GDP growth came from final domestic demand, while the external trade deficit increased

Final domestic demand rose 0.4% in the second quarter, following a 0.6% increase in the first quarter. Final consumption expenditure was up (+0.4%), mainly from general government consumption expenditure (+0.8%), while that for households experienced a more moderate increase (+0.2%). Fixed capital investment was up (+0.3%) following decreases for seven consecutive quarters.

Final household consumption expenditure was up on account of service expenditure (+0.4%), though goods expenditure remained stable in the second quarter. Non-durable expenditure recorded 0.9% growth, which was sufficient to counterbalance the decreases observed in the purchase of durable (–1.0%) and semi-durable (–1.2%) goods. Fixed capital investment growth was explained by the renewal of business investment (+0.5%), while government investment shrank by 0.5%.

Business investment in residential construction rose 0.4% in the second quarter, mainly on account of new construction (+1.2%); renovation activities experienced moderate growth (+0.1%). Home resale activities dropped 0.5%. Business investment in machinery and equipment rose 1.7%, the second consecutive period of growth, while that in intellectual property inched slightly downward (–0.2%).Investment in non-residential structures remained stable in comparison with the first quarter.

In the second quarter of 2016, total exports of goods and services dropped 1.1% due to a 2.2% decrease in the international export of goods. Exports to the other provinces were stable, the export of services increased +0.4%, which eliminated the –0.4% decrease in goods. Total imports were up 0.3%, with international (+0.3%) and interprovincial (+0.4%) imports experiencing growth at similar rates. Since imports grew more than exports, the external trade deficit rose $2.2 billion to $9.8 billion.

Monthly GDP up in June

Québec’s real gross domestic product (GDP) at basic prices rose 0.1% in June 2016, following 0.3% growth in May and 0.1% growth in April. In Canada, GDP rose 0.6% in June. In Québec, this growth was on account of the gains recorded by services-producing industries (+0.1%). Goods-producing industries also increased their output by 0.1%. This was revealed in Produit intérieur brut par industrie au Québec, juin 2016, a publication by the Institut de la statistique du Québec.

In June 2016, goods-producing industries recorded a 0.1% increase, following a 0.3% drop in May and 0.8% increase in April. The growth in June was mostly on account of the manufacturing sector (+1.2%). Mining, quarrying, and oil and gas extraction also experienced growth (+0.6%), contrary to the output of agriculture, forestry, fishing and hunting ( 4.6%), utilities ( 1.2%) and construction (–0.3%). Service output rose 0.1% in June, following 0.6% growth in May and a 0.1% decrease in April. Significant gains were observed in transportation and warehousing (+0.9%), real estate and rental and leasing (+0.3%), and public administration (+0.8%). Conversely, output levels dropped in retail trade (–0.7%), professional, scientific and technical services (–0.3%), and accommodation and food services (–0.6%).

Manufacturing sector output rose 1.2% in June, following a 1.4% drop in May and a 0.1% drop in April. This increase was mainly on account of a 2.0% increase recorded in durable goods manufacturing. Non-durable goods manufacturing increased by 0.1%.


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