Canada’s economy shrank for 1st time in 6 months on mining

Weak Context

Canadian National Railway Co., the country’s biggest railroad, said Oct. 22 it may not reach the upper end of a forecast range for full-year profit. “Given the weak economic context, however, we certainly have our work cut out,” Chief Financial Officer Luc Jobin said on a conference call.

“We’re going to see some variations month to month,” Flaherty told reporters in Ottawa today. “Overall for the year we’re on track” for economic growth, he said.

The August contraction was limited by a 1 percent increase in wholesale trade and a 0.3 percent gain in transportation and warehousing.

The economy probably expanded at a 1 percent annualized pace between July and September, and should grow at a 2.5 percent fourth-quarter pace, the Bank of Canada said Oct. 24.

“The economy is struggling to churn out any growth whatsoever,” said Doug Porter, deputy chief economist at BMO Capital Markets in Toronto. “We would look for a modest rebound in output in September, but the fourth quarter is expected to see growth of less than 2 percent as well.”

Bloomberg News

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