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Analysts at TD Securities note that Canada’s industry-level GDP was unchanged in July, slightly below expectations for a 0.1% increase.

Key Quotes

“As expected, services were the main source of strength while weaker energy production weighed on the goods-producing sector.”

“This report will do little to change the BoC’s outlook. The Bank will look through some of the energy sector headwinds, and we are still tracking Q3 growth near 1% which should be sufficient to push rate cuts into 2020.”

“FX: Knee-jerk CAD weakness should eventually be faded as the BOC is not in a rush to cut soon. The CAD should remain a better performer against the low yielders like the EUR. Little impetus for USDCAD to be shaken out of its 1.3150/3350 range.”