Canadian economy expanded in May, while U.S. economic recovery slows down

According to Statistics Canada, Canada’s GDP grew by 0.1 per cent in May, after being flat in April. The growth was mostly driven by the goods-producing sector, which grew 0.6 per cent in May. Activity in oil and gas exploration also contributed to the increase.

Many sectors contributed to the expansion of Canada’s GDP. Manufacturing was up by 0.1 per cent in May. The finance and insurance sector grew 0.5 per cent with increased banking activity and a higher volume of trading on stock exchanges. Retail trade grew in May by 0.3 per cent, with significant increases in clothing and accessories, and in food and beverage stores.

By contrast, in the US, spending by consumers has weakened, and trade deficits have also contributed to a recent slowdown in economic growth.

While Canada’s GDP has expanded, the U.S. economic recovery lost momentum as growth slowed to a 2.4 per cent pace, the lowest growth rate in nearly a year. The U.S. Commerce Department's report released Friday also shows the economic recovery has been losing power for two straight quarters. Economists predict this rate of economic growth is too weak to reduce the high unemployment rate resulting from the recession.