Québec, June 27, 2017. – In the first quarter of 2017, gross domestic product (GDP) at market prices rose 1.1% in real terms, an annualized increase of 4.3%. In Canada, quarterly growth stood at 0.9%, an annualized change of +3.7%. Compared with the first quarter of 2016, GDP grew 2.9% in Québec and 2.3% in Canada. This was revealed in Comptes économiques du Québec, 1er trimestre 2017, a publication of the Institut de la statistique du Québec.
Growth in final domestic demand (+0.9%) was generalized in the first quarter and led to a seventh consecutive quarterly increase. Final consumption expenditure rose by 0.7% and investment was up (+1.6%), continuing its recovery which began in early 2016. The external trade deficit rose considerably, and inventory levels went up significantly.
Growth in household final consumption expenditure (+0.9%) was spurred on mostly by the purchase of goods (+1.4%), as services only went up 0.5%. Purchases of durable goods continued to increase in the first quarter of 2017 (+1.8%) after a 5.1% rise in 2016. Household purchases of semi-durable goods (+1.7%) and non-durable goods (+1.0%) were also up in the first quarter, as was general governments final consumption expenditure (+0.2%).
Sustained increase of investment in residential buildings
Residential investment rose 2.7% in the first quarter, following a 3.4% increase in the fourth quarter of 2016. New home construction was up 2.1%, renovation rose by 3.9%, while resale activity dropped 0.4%. Business investment in non-residential structures was little changed (+0.1%) in the first quarter, while investment in machinery and equipment surged (+3.8%). General governments gross fixed capital formation increased 0.5%.
Exports dropped 3.3%, solely on account of a decline in international exports of goods (-7.2%), as exports to other provinces rose by 0.8%. Imports were down 0.3%, owing to a drop in international trade of goods (-0.8%), while imports from other provinces increased 0.3%. Consequently, the external trade deficit grew sharply, going from -$7.4 billion in the fourth quarter of 2016 to -$12.3 billion in the first quarter of 2017.
Monthly gross domestic product rose in March
Québec’s real gross domestic product at basic prices grew 0.4% in March 2017, following a 0.1% increase in February. Canada’s GDP recorded a 0.5% rise in March. The increase in Québec was essentially due to goods-producing industries. Services-producing industries maintained the same output level as in February.
In March 2017, goods-producing industries recorded a 1.2% increase, following a 0.4% decline in February. Output was up in utilities (+5.2%), manufacturing (+0.9%), construction (+0.6%), as well as in mining, quarrying, and oil and gas extraction (+1.2%). On the other hand, output was down in agriculture, forestry, fishing and hunting (-2.3%).
Service output remained unchanged in March, following increases of 0.3% in February and January. Several sectors experienced growth in March, including wholesale trade (+0.6%), finance and insurance (+0.7%), professional, scientific and technical services (+0.4%), and educational services (+0.5%). Conversely, output levels dropped in transportation and warehousing (-0.5%), accommodation and food services (-2.5%), and public administration (-0.4%).
Output in the manufacturing industry went up 0.9% in March, following a 1.6% decline in February and zero growth in January. This increase in March was mainly on account of a 1.8% rise in non-durable goods manufacturing. Durable goods manufacturing increased by 0.1%.
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