Canada's GDP shrank at 0.6% pace in 1st quarter, Statistics Canada says

Canada's economy shrank by 0.1 per cent in the first three months of 2015, as the economic impact of oil's gloom spread to other sectors.

It's the first time the economy has contracted on a quarterly basis since 2011.

Statistics Canada said Friday that many sectors, including  mining, quarrying, and oil and gas extraction, construction, wholesale trade and manufacturing were in negative territory for the three months between January and March.

There was growth in finance and insurance, utilities, as well as the agriculture and forestry sectors, but not enough to offset weakness everywhere else.

Expressed as an annualized rate, GDP contracted 0.6 per cent in the first quarter.

"While the headline number was bad, the underlying details were worse," TD Bank economist Randall Bartlett said, adding the weak number makes it more likely the central bank will move to cut rates again some time this year.

Bank of America's economist Emanuela Enenajor agrees with that assessment, saying in a note that "October is still our base-case for a cut, but persistently weak data could put a July ease on the table."

For comparison purposes, the U.S. economy shrank by 0.7 per cent over the same period, according to updated numbers that also came out Friday

The loonie reacted swiftly to the bleak number, shedding about half a cent to trade below 80 cents US early Friday.