Canada: Economic activity rises in July
GDP reading: GDP rose 0.2% month-on-month in seasonally adjusted terms in July (June: 0.0% mom), above the preliminary estimate of a flat reading. On an annual basis, monthly GDP rose at a faster rate of 1.5% in July (June: +1.3% yoy).
Drivers: Expansions in agriculture, manufacturing and services drove July’s month-on-month growth, though wildfires dampened activity in sectors such as accommodation, mining and transport.
GDP outlook: Flash data suggests that GDP was flat month on month in August, as increases in oil and gas extraction and the public sector were offset by contractions in manufacturing and transportation and warehousing.
Panelist insight: On the state of the economy, Desjardins’ analysts said:
“Real GDP gains continue to lag the pace of population growth. […] Canadian output per person [has] fallen in seven of the past eight quarters – a streak not previously seen outside of a recession. In August, job creation fell behind population growth and the unemployment rate moved higher, suggesting more economic slack in the third quarter.”