Canada: Economy maintains solid pace of recovery into November – TD Securities

Assessing the latest Gross Domestic Product data from Canada, “the Canadian economy maintained a solid pace of recovery into November with industry-level GDP rising by 0.7% m/m, exceeding the market consensus for a 0.4% increase,” said TD Securities analysts.

Key quotes

“What was even more impressive than the strong headline print were new flash estimates from Statistics Canada calling for 0.3% m/m increase in December despite building headwinds from more severe lockdowns.”

“Overall, it is hard not to be encouraged by the strength of the ongoing recovery. November growth was broadly based with output higher in 14 of 20 industries, and the headline strength paired with positive flash estimates for December will bolster Q4 tracking (now sitting near 8% annualized).”

“We are somewhat skeptical that a 0.3% increase will be achieved next month given more widespread business closures, but it does suggest the handoff to Q1 will be significantly stronger than previously anticipated, offering the slim hope of a positive Q1 print.”