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Data released on Friday showed the Canadian economy recovered further in August with real GDP rising 1.2%. According to National Bank of Canada analysts, going forward, the economic recovery will face important challenges amid the latest surge in COVID-19 cases. 

Key Quotes:

“Canadian GDP registered yet another advance in August but the economic recovery remains highly uneven. Some sectors have now fully recovered from the COVID-19 shock and currently stand above their pre-pandemic peaks.”

“While the economic rebound is likely to have extended into September – the Statistics Canada advance estimate suggests production expanded another 0.7% in the month – the steep gap between the best and worst performing industries is likely to endure until a vaccine.”

“Looking further ahead, the real question remains whether the recent momentum can be sustained into the fourth quarter. The latest surge in COVID-19 cases has forced some provincial governments to reintroduce stricter measures which could prove to be a substantial headwind for the recovery in the last three months of the year.”