Canadian economy slows in April after hot start to 2017: MLI Leading Economic Indicator

Macdonald-Laurier Institute

Macdonald-Laurier InstituteApril slowdown in the Canadian economy halts a burst of growth in the first quarter of 2017

OTTAWA, June 1, 2017 – Signs of a slowdown for the Canadian economy are on the horizon as the burst of growth during the first quarter of 2017 fizzled out in April.

The Macdonald-Laurier Institute composite leading index rose by 0.4 percent in April, after a 0.5 percent gain in March.

After picking up to growth of 0.8 percent over the winter, this slowdown suggests the first-quarter burst of GDP growth will not be sustained.

“Growth was led again by housing, before governments took action to cool off the Toronto market”, writes Philip Cross, the leading index’s author.

“However, growth in the US was the slowest since last summer, a poor augur for Canada’s exports”.

To learn more about the leading economic indicator, click here.

The leading index is designed to signal an upcoming turn in the business cycle, either from growth to recession or from recession to recovery, six months in advance, with an error rate of less than five percent. It does so by monitoring what businesses and households have actually committed to in terms of future spending and production in the most cyclically-sensitive sectors of the economy. It also incorporates global influences such as the direction of the US economy and the broad thrust of monetary policy.

The index is available on Bloomberg and is intended for journalists and analysts who follow the macro performance of the Canadian economy. Quarterly economic analyses by Cross, based on the results of the indicator, will appear on the MLI website.


Philip Cross is a Munk Senior Fellow with the Macdonald-Laurier Institute. He previously served as the Chief Economic Analyst for Statistics Canada, part of a 36-year career with the agency.

The Macdonald-Laurier Institute is the only non-partisan, independent national public policy think tank in Ottawa focusing on the full range of issues that fall under the jurisdiction of the federal government.

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