Real gross domestic product advanced 0.4% in November, a third consecutive monthly increase, according to figures released this morning by Statistics Canada. As was the case in September and October, most major industrial sectors increased their production.
The goods-producing industries (+0.6%) grew for a third month in a row, while the services industries increased 0.4%. Mining and oil and gas extraction, and wholesale trade accounted for about 60% of the overall growth.
Several other sectors also recorded increases, such as finance and insurance, construction and the public sector (education, health and public administration combined). Conversely, retail trade and utilities declined in November, while the manufacturing sector remained unchanged.
The mining sector increased 1.8% in November, largely on the strength of oil and gas extraction. Natural gas production rose as prices, while remaining low compared with a year ago, increased recently. Oil extraction went up as foreign demand increased. Support activities for mining, oil and gas extraction advanced for a fourth month in a row.
The mining sector excluding oil and gas extraction rose 2.5% as some producers in the copper, nickel, lead and zinc mining industry boosted their production after resuming their operations in October.
The volume of wholesaling activities increased 2.4% in November, with all trade groups advancing, with the exception of machinery and equipment, and metal products. The most notable increases were in the wholesaling of food products, motor vehicles (which recorded a 16% surge in imports) and building supplies.
The finance and insurance sector grew 1.2% in November. This gain was attributable to strong activity in the bond markets and a significant increase in mutual fund sales. There was also strength in personal loans and residential mortgages.
Construction activity rose 1.1% in November, a fourth consecutive monthly increase. Residential building construction (+2.5%) and, to a lesser extent, engineering and repair work (+0.6%) advanced. Non-residential building construction edged down as an increase in institutional building was more than offset by decreases in industrial and commercial building.
The home resale market continued to advance, resulting in a 0.7% increase in the output of real estate agents and brokers.
Value added in retail trade fell 0.8% in November. Significant decreases were posted in the automotive sector, general merchandise stores (which include department stores), and clothing and accessories stores. On the other hand, increased activities at furniture, home furnishings and electronic stores as well as building materials stores partially offset the declines.
Elsewhere on the economic calendar, StatsCan said this morning that in December, the Industrial Product Price Index (IPPI) and the Raw Materials Price Index (RMPI) fell 0.1% and 1.7% respectively, pulled down by lower petroleum prices.
The IPPI edged down 0.1% after the 0.9% upturn in November. The movement of the index has remained relatively stable since May 2009.
In December, petroleum and coal prices (-1.4%) contributed the most to the decline in the IPPI, while rising prices for primary metal products (+1.2%) tempered the decline in the IPPI.
Excluding petroleum and coal prices, the IPPI remained unchanged, despite the increase in prices for primary metal products. The 0.5% appreciation of the Canadian dollar in relation to the US dollar contributed to a price decrease for a number of products, including motor vehicles and other transport equipment (-0.2%).
Some Canadian producers who export their products to the United States are generally paid in prices set in US dollars. Consequently, the relative strength of the Canadian dollar in relation to the US dollar had the effect of reducing the corresponding prices in Canadian dollars.
If the exchange rate used to convert these prices had remained unchanged, the IPPI would have registered no change, instead of declining 0.1%.
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