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Analysts at TD Securities note that Canada’s industry level GDP surprised to the upside in July at 0.2% m/m (market: 0.1%) on strength in manufacturing and wholesale activity.

Key Quotes

“This leaves our tracking for Q3 growth sitting at 2.4%, well above official BoC projections. An October rate hike was already well priced heading into the data, though today’s report will add to speculation around a second hike in January.”

FX: USDCAD is sitting near fair value after the upside on GDP, leaving broader USD sentiment, global risk, and month-end flows to dictate the price action from here. The next key support level to watch is 1.2885.”