XPost: can.jobs   
   From: abc@123.cl   
      
   Economy climbing back, but from ‘deeper hole’ than expected   
      
   Manufacturing, energy lead decline in May   
      
   Gordon Isfeld, Thursday, July 23, 2009   
      
   The economy retreated by 0.5% in May -- a bigger slide than in any of   
   the previous three months, and extending the economic downturn to 10   
   straight months. Canwest News Service The economy retreated by 0.5% in   
   May -- a bigger slide than in any of the previous three months, and   
   extending the economic downturn to 10 straight months.   
      
   OTTAWA -- The end may be in sight for Canada's recession, but it will   
   have to "crawl out of a deeper hole"than anybody expected, economists   
   said Friday,   
      
   In May alone -- less than two months before the Bank of Canada declared   
   the recession all but over -- the economy was in deep decline, as key   
   industries like energy and manufacturing continued to contract,   
   Statistics Canada said Friday.   
      
   The economy retreated by 0.5% in May -- a bigger slide than in any of   
   the previous three months, and extending the economic downturn to 10   
   straight months, the federal agency said.   
      
   While most economists acknowledge the recovery will become evident in   
   the coming months, BMO Capital Markets deputy chief economist Douglas   
   Porter said May's surprisingly big contraction means "the economy will   
   need to crawl out of a deeper hole."   
      
   GDP had been expected to shrink 0.3% during the month.   
      
   Charmaine Buskas, senior economics strategist at TD Securities, said   
   "it is clear that activity throttled back significantly in May."   
      
   "If one assumes June GDP growth is flat, then second-quarter Canadian   
   GDP is on track for a slightly more than 3% . . . decline."   
      
   Still, BMO's Porter said the May GDP report "is looking deep into the   
   rear-view mirror."   
      
   "Early results from June are much more positive, and we believe next   
   month's release will show something closer to flat," Mr. Porter said,   
   adding there are signs of improving auto and home sales that should   
   make July "a relatively strong month."   
      
   "There is a sense that things are turning,"he said.   
      
   Marco Lettieri, an economist at National Bank Financial, said he   
   expects "both domestic and foreign demand to rise in the second half of   
   the year and that the second quarter should mark the end of the current   
   recession in Canada."   
      
   In its report, Statistics Canada said energy-sector output fell 2.3% in   
   May. "Oil and gas extraction as well as associated support activities   
   posted significant declines. Both petroleum and natural gas production   
   were hampered by falling export demand. Maintenance work at some crude   
   petroleum facilities also lowered production," the agency said.   
      
   Manufacturing, meanwhile, continued to decline in May. Output fell   
   1.6%, led by a big drop in motor vehicle manufacturing auto parts   
   production.   
      
   "The temporary closure of two assembly plants, combined with the   
   discontinuation of the production of a model line in Canada,   
   contributed to this decline. Output was also down in primary metal,   
   fabricated metal products, and machinery manufacturing."   
      
   So far, official data have shown Canada's economy shrank 5.4% in the   
   first quarter of this year - its fastest pace of contraction since   
   1991. That followed a 3.7% decline in the fourth quarter of 2008.   
   Economists are forecasting a 3% drop in the second quarter.   
      
   Last week, the Bank of Canada said the recession in Canada had come to   
   an end. Bank governor Mark Carney said the economy is now expected to   
   grow 1.3% in the third quarter of this year, ending Sept. 30, followed   
   by a 3% gain in the final three months of 2009.   
      
   The central bank also revised its forecast for this year, saying the   
   economy would contract 2.3% overall and grow 3% in 2010. It had   
   previously expected a 3% decline this year and 2.5% growth next year.   
      
   On Thursday, the Conference Board of Canada offered its outlook for the   
   economy, saying Canada will still end the year with negative growth of   
   1.9%. However, the think-tank said GDP will increase to 2.7% in 2010.   
      
   The next important reading on the economy comes next week, when   
   Statistics Canada releases unemployment data for July. The Canadian   
   economy has lost 454,000 full-time jobs since peak employment in   
   October and the unemployment rate has climbed to 8.6%, an 11-year high.   
   Economists expected next Friday's report to show a further 20,000 job   
   cuts and an even higher unemployment rate.   
      
   --- SoupGate-Win32 v1.05   
    * Origin: you cannot sedate... all the things you hate (1:229/2)