Canadian Building Permits Plummet to Lowest Level Since December 2020

(MENAFN) According to the statistical authority of Canada, the country witnessed a significant decline in building permits during April, dropping by 18.8 percent to reach its lowest level since December 2020. This figure came as a surprise as it fell well below expectations of a more modest 2.9 percent monthly decrease. Additionally, the building permits data for March was revised upwards from an initial gain of 11.3 percent to 12.3 percent.

In a statement released by Statistics Canada, it was revealed that the total monthly value of building permits in April amounted to USD9.6 billion. However, the decline in permits was particularly pronounced in the non-residential sector, which experienced a sharp decrease of 34.6 percent to reach USD3.4 billion. This downturn was primarily driven by significant declines in both the commercial and industrial sectors, with drops of 40.2 percent and 49.6 percent, respectively.

Within the commercial sector, building permits suffered a substantial decline of 40.2 percent, while the industrial sector saw a notable decrease of 49.6 percent. These reductions contributed to the overall decline in the total monthly value of non-residential permits.

On the other hand, the total monthly value of residential permits also experienced a decline of 6.1 percent to USD6.1 billion, marking the second consecutive month of decrease in this sector.

The sharp drop in building permits reflects a challenging environment for the construction industry in Canada. The decline in non-residential permits, particularly in the commercial and industrial sectors, suggests a decreased appetite for new construction projects during April. The residential sector also faced a decline, highlighting potential weaknesses in the housing market.

These figures underscore the need for close monitoring of the construction industry's performance in the coming months, as it plays a crucial role in the overall economic activity of the country. The data suggests potential headwinds and uncertainties in the construction sector, which may have broader implications for Canada's economic recovery and growth.



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