Canadian Economy Recovers Almost Half Of Lost Ground Since Height Of Pandemic
The Canadian economy has recovered almost half of its lost ground since the start of the Covid-19 pandemic, according to BNN Bloomberg.
Statistics Canada reported that over May and June the GDP increased about 10 percent, which has offset the 18 percent that it dropped over March and April when the pandemic first started.
Flash estimates show that economic activity in June was at about 90 percent of what it was in February before the start of the pandemic. At the height of the pandemic in April, output levels were at about 82 percent of pre-pandemic levels.
Brett House, deputy chief economist at Bank of Nova Scotia, wrote in an email that there is “still a big gap by any historical comparison, but this also marks a quick rebound.”
Even with the May-June increase, the second quarter of 2020 will likely be recorded as the one of the worst since the Great Depression. Estimates put economic activity in the quarter down by 12 percent compared to the first quarter, which is close to 40 percent at an annualized rate.
By comparison, the U.S. saw a 33 percent contraction in the second quarter. “While such a decline was expected, it was worse than what was seen earlier in the week in the U.S. for the same quarter, as Canada enacted restrictions earlier and eased them less aggressively,” Royce Mendes, an economist at Canadian Imperial Bank of Commerce, said in a note to investors. “The good news is that the cautiousness has kept virus cases under control north of the border, suggesting Canada’s economy is in a position to outperform that of the US in Q3.”