Canada: Strike spillovers and drop in retail spending drive an October GDP contraction - TD

Analysts at TD Bank Financial Group (TD) note that the data released on Monday revealed Canada's real GDP fell 0.1% in October.

• "Thirteen of 20 major sector groupings reported higher levels of output as declines were concentrated in a few sectors, notably manufacturing.
• Indeed, the biggest drag on overall activity came from manufacturing (down 1.4%). The biggest story there was spill-overs from a U.S. auto sector strike that sent transportation equipment manufacturing 2.5% lower, but there were additional drags. Eight of 10 subsectors reported lower output in October, including machinery manufacturing, fabricated metal products, and wood products, as well as rubber and plastics products.
• Performances among other goods-producing industries were mixed, leaving the sector as a whole down 0.5% month-on-month, the third decline in the last four months.
• Among the service sectors, output was flat, but this masked significant divergence in performances. Retail and wholesale trade fell markedly (-1.1% and -1.0% respectively), offset by better performances among sectors including real estate (+0.3%), transportation (+0.6%), and professional services (+0.3%)."