Belts continue to tighten across corporate Canada amid falling profits across a number of sectors, creating a slowdown in investment not seen since the 2009 recession.
Some economists expect profits to remain weak in the coming quarter as a result of volatile commodity prices, while others predict a "bounce back" a result of the depreciating loonie and steady comeback of the U.S. economy.
Statistics Canada data released Tuesday shows corporate profits fell 3.3 per cent in the first three months of the year compared to the same time last year, dragged down by the financial sector, mining and manufacturing.
“The effects of a low profit environment are being felt through other channels of the economy,” said TD economist Jonathan Bendiner, who noted that investment plans for 2013 grew by just 1.7 per cent, which is the slowest pace since 2009.
The picture was bleakest in the financial sector, where profits fell 4.7 per cent in the first quarter. That includes a 16-per-cent decrease fromRead More »from Corporate profits down in Canada in Q1