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James Knightley, Chief International Economist at ING, suggests that Canada’s July GDP print (0.2% MoM) was slightly better than we expected, but they’re not expecting any surprises to the upside for August – in fact, they see a flat monthly figure.

Key Quotes

“This shouldn’t take the shine off things as the growth story in Canada has shown underlying momentum throughout summer, and we don’t see this changing anytime soon – we are forecasting a healthy 2.4% YoY print.”

“Trading surplus won’t be enough to see gains from July

Despite August posting the first trading surplus (0.526 CAD billion) since December 2016, negative data for both retail sales and wholesale trade are likely to weigh on GDP – and ironically so will manufacturing.”

“The risks will be watched closely, but the chance of all of them escalating at once is very small – jeopardising growth expectations.”

“For now, our growth outlook remains upbeat, with 2.6% and 2.1% average growth predicted for 2018 and 2019 respectively.”