The result for January matched the expectations of economists, according to financial markets data firm Refinitiv.
Statistics Canada said reduced trade with China and advisories against non-essential travel to the country affected potential growth in January.
Since then, the agency said, the pandemic and a collapse in oil prices has significantly affected the economy.
Benjamin Reitzes, director of Canadian rates and macro strategist at Bank of Montreal, called the January numbers “ancient history.”
“While the year got off to a decent enough start, the near-total halt in activity in the second half of March will have a hugely negative impact,” Reitzes wrote in a report.
“With the virus-mitigation measures almost certainly continuing through April, Q2 is going to get hit much, much harder.”
In January, manufacturing rose 0.8% as both durable and non-durable manufacturing increased. The finance and insurance sector increased 0.9%.
The transportation and warehousing sector fell 1.7% in January.
However, since then, steps taken to slow the spread of the novel coronavirus have brought non-essential businesses to a standstill, while oil prices have crash amid a price war between Saudi Arabia and Russia.
The result has been layoffs at businesses and more than one million Canadians applying for employment insurance benefits.
Ottawa has moved to shore up the economy by spending billions to help those affected and to ensure the health care system has the resources it needs to deal with the crisis.
The Bank of Canada has also reduced its key interest rate target to 0.25% and stepped up measures to ensure financial markets continue to operate.
“March’s GDP is likely to show a record decline — one that will stand until we get the April figures,” said Josh Nye, a senior economist at Royal Bank of Canada.
“The government, like others around the world, has committed billions and billions to supporting the economy through this period of unprecedented disruption. Those efforts won’t be enough to prevent a recession — even with a decent start to Q1, March is likely to pull the quarter into negative territory, and drop in Q2 activity looks like a sure thing.”