It's going to be a blockbuster kind of week for the Canadian economy.<\/p>\n
The deadline to renew Canada-U.S.-Mexico Agreement will (almost assuredly) swoosh by on Wednesday, accompanied by a chorus of commentary and recriminations.<\/p>\n
Before we get there, we will get the latest GDP numbers for April on Tuesday.<\/p>\n
The economy has been struggling to find its footing. We experienced back-to-back quarters of economic contraction through the end of last year and the beginning of this year, sparking heated debate about whether Canada is in a technical recession.<\/p>\n
Wherever you land on that debate, one thing is abundantly clear: Canada's economy is weak. It was weak before Donald Trump came along. But the U.S. president's trade war has made it weaker still. It hasn't grown in a year.\u00a0<\/p>\n
What Canadians need to know about a 'technical recession'<\/p>\n
But down at the bottom of the last GDP report, Statistics Canada offered this glimmer of hope:<\/p>\n
"Advance information indicates that real GDP increased 0.4 per cent in April," wrote the statistical agency.<\/p>\n
Now, 0.4 per cent doesn't sound like much. But if the economy was growing by that much every month, we would be a roaring economy.<\/p>\n
Canada has only posted 0.4 per cent monthly growth six times since the summer of 2022.<\/p>\n
"Early data is pointing to a significant increase in non-conventional oil extraction and oil drilling in April. Adding in a pickup in manufacturing GDP, goods-producing sectors overall likely expanded by one per cent," wrote RBC economists Nathan Janzen and Claire Fan.<\/p>\n
They also warn that these data releases have become "highly revision-prone" lately.<\/p>\n
Indeed, revisions have loomed large this year. Economists were expecting the last GDP release to show the economy had surged to start the first quarter of the year.<\/p>\n
So, what happened? Well, for starters, GDP numbers were heavily revised between the release of the February and March data.<\/p>\n
Desjardins deputy chief economist Randall Bartlett, along with economist L.J. Valencia, wrote a scathing paper on the impact these revisions are having.<\/p>\n