The Canadian economy expanded 0.2 per cent in July, up from a sluggish 0.1 per cent rate in June. Growth was led by strength in the manufacturing, retail, while mining,oil and gas extraction and construction were weaker.
Third quarter economic growth is off to a much stronger start than anticipated given some of the weak data releases of late. Our updated third quarter GDP tracking estimate is now showing just under 2 per cent growth.
We are forecasting that the Canadian economy will grow at a modest pace of about 2.1 per cent this year followed by a similar pace of growth in 2013. Moderate growth and low inflation combined with lingering global economic uncertainty will continue to keep the Bank of Canada on hold well into 2013.
BCREA Economics Now