OTTAWA – New figures from Statistics Canada show the economy contracted for two consecutive quarters in the first six months of 2015, which meets the technical definition of a recession. Here are five things to know about the numbers:
Rebound simmering: Even even though the economy declined at an annual pace of 0.5 per cent over the second quarter as a whole, it grew 0.5 per cent in June, the final month of the quarter. The June increase was the first one-month spurt in real gross domestic product to hit 0.5 per cent since it rose 0.63 per cent in July 2013.
Households fuel growth: The data shows that household consumption climbed 0.6 per cent at a time when interest rates remained low. As a result, household savings dipped to 4.0 per cent from 5.2 per cent in the first quarter. Transport purchases — with help from 2.9 per cent growth in vehicle purchases — were the biggest component with a 1.5 per cent increase.
Oil slump blues: Natural resources, including mining, quarrying and oil and gas extraction, contracted by 4.5 per cent in the second quarter — for the second straight quarter. The decline was mostly tied to a 5.7 per cent drop in the non-conventional oil extraction sector.
Exports creep up: The numbers reveal that exports edged upwards in the second quarter by 0.1 per cent following two quarters of contraction. Goods exports gained by 0.2 per cent, reversing a 0.5 per cent decline in the first quarter. The export of motor vehicles and parts rose by 4.7 per cent, while crude oil and crude bitumen climbed by 3.3 per cent.
Business investment drop: Business investment in machinery and equipment fell 4.6 per cent in the second quarter, while non-residential structures tumbled 2.3 per cent for a third consecutive quarterly decline. The drop was fuelled by lower investment in non-residential buildings, which was down 1.8 per cent, as well as the 2.4-per-cent decline in engineering structures.
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