OTTAWA - The Canadian economy held steady in April as strength in the resource sectors offset declines in the manufacturing industry, which left real gross domestic product unchanged for the month.
CIBC chief economist Avery Shenfeld called the April results "a touch better than expected."
Economists had forecast the economy to contract by 0.1 per cent in April.
"A strong finish in June would put the economy on track for just over one per cent growth, too sluggish for the Bank of Canada to hike rates in July," Shenfeld said.
Statistics Canada reported significant increases in mining of metal ore and coal, while retail trade, the public sector, construction and utilities also advanced.
But the agency said the growth was offset by declines in manufacturing and, to a lesser extent, in wholesale trade and the finance, insurance and real-estate sectors.
BMO deputy chief economist Doug Porter said the bigger issue is whether the economy can regain its "mojo" in the second half of the year.
"With gasoline prices simmering down, auto production poised for at least a partial rebound, and hopefully fewer weather 'events' in coming months, we look for growth to pick up to the 2.5 per cent-to three per cent range in the next two quarters," Porter said.
Mining rose one per cent in April, primarily on the strength of copper, nickel, lead and zinc mining; coal mining also contributed to the growth.
Support activities for mining oil and gas extraction continued to advance, though overall oil-and-gas extraction was down 0.3 per cent.
Transportation services were unchanged.
Manufacturing decreased 0.7 per cent, with most of the decline concentrated in the production of durable goods. A 6.9 per cent decrease in motor vehicles and parts production was mostly due to supply disruptions as a consequence of the tsunami in Japan.
This decrease, combined with lower production of aerospace products, led to a 4.7 per cent reduction in manufacturing of transportation equipment.
Manufacturers of furniture and related products, printed products and electric equipment also cut back production. Manufacturing of machinery -- notably of mining and oil-and-gas machinery and of food products -- increased.
Retail trade increased 0.5 per cent in April after declining in March, while Wholesale trade decreased 0.5 per cent in April.
Construction edged up 0.1 per cent.
The output of real estate agents and brokers decreased 4.4.
The finance and insurance sector fell 0.4.
