The lack of widespread contraction across Canadian industries, regions and components of economic
growth is the biggest factor keeping the recession label off, BMO's Robert Kavcic said in an overnight note.
Final domestic demand in the Canadian economy was still growing 1.3% y/y as of Q1, and the -0.4%
q/q print followed a "chunky" 2.7% advance in the prior quarter, Kavcic noted. Government aside, the private components are very mixed -- residential investment and M&E are down from a year ago, but
household spending and intellectual property investment are still growing, he said. The trade war and
housing recession are clearly having an impact, but it's not being felt everywhere, he added.
Stepping back, one common thread of every period officially labeled a recession since 1980 (there were four of them), was synchronized declines across these components of private domestic demand, he said.