Canada: GDP growth moderates in July but stays on track for solid quarter – NBC

National Bank of Canada's Alexandra Ducharme notes that Canadian Gross Domestic Product (GDP) growth moderated in July after three strong months, with both goods and services output flat.

Growth moderates but remains resilient

"This morning’s GDP report confirms that the Canadian economy’s rebound lost some momentum in the third quarter. Still, Statistics Canada’s preliminary estimate points to a 0.2% increase in GDP in August."

"Incorporating this estimate and assuming no growth in September, GDP by industry is tracking a 2.0% annualized increase in the third quarter, which would represent a relatively solid quarterly advance."

"This is likely easing some of the Bank of Canada’s concerns about the economy’s ability to withstand trade tensions, which have recently intensified."

"This has allowed the Bank to remain patient in the face of the oil shock so far, but we think that patience could be tested in the fourth quarter."

"The longer the conflict persists, the greater the risk that higher energy costs spill over more broadly into underlying inflation, particularly if economic activity remains resilient."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor. Know more.)