Canadian economy shrinks in January, oil and gas sector has biggest drop since 2016

Statistics Canada says the economy contracted 0.1 per cent in January.

The agency says the drop in real gross domestic product for January compared with growth of 0.2 per cent in December.

Economists had expected an increase of 0.1 per cent for the first month of the year, according to Thomson Reuters.

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Goods-producing industries fell 0.4 per cent in January, as non-conventional oil extraction fell due in part to unscheduled maintenance shutdowns at some facilities.

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Overall, the mining, quarrying, and oil and gas extraction sector posted its biggest drop since May 2016 as it fell 2.7 per cent in January.

Meanwhile, services-producing industries were essentially unchanged for the month as real estate and rental and leasing fell 0.5 per cent, offset by increases in the wholesale, retail, and finance and insurance sectors.