Canada's economic growth unchanged in July, August likely to expand 0.2%
Canada's economy was flat in July, while an advanced estimate points to 0.2% growth in August.
The fruits and vegetables section is seen at a supermarket in Ottawa, Canada, on 13 July, 2022. Photo: REUTERS/Patrick Doyle
Canada's economic growth was flat in July, data showed on Tuesday, in line with expectations and signalling a slower start to the third quarter after solid growth in the previous three months.
This followed three straight months of positive growth and came just before a new set of tariffs from the United States hit Canada in August.
Here are the details:
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- Both the goods-producing and services-producing industries were largely unchanged in July, Statistics Canada said. Goods-producing sectors contribute roughly a quarter of gross domestic product.
- Among goods-producing industries, the manufacturing sector decreased by 0.9% in July, posting its first decline in four months. This was primarily driven by a 6.2% drop in activity at petroleum refineries.
- Mining, quarrying and oil and gas extraction also declined by 0.5%, falling for the second month in a row, Statistics Canada said.
- However, utilities and construction grew by 1.7% and 1.3%, respectively, offsetting most of the decline, the statistics agency said. The construction sector rose for a fourth consecutive month.
- Among services-producing industries, retail trade shrank by 1% and wholesale trade fell 0.4% in July. Wholesale trade was among the biggest contributors to growth in June.
- Professional, scientific and technical services rose 0.3% in July, their largest monthly growth rate in the past 20 months. Real estate, rental and leasing grew 0.2% in July, with real estate expanding for a sixth consecutive month.
- An advanced estimate from Statistics Canada showed that the economy was likely to rebound in August, with monthly growth of 0.2%. The growth will primarily be led by higher output in mining and quarrying and retail trade, Statistics Canada said.
- The Bank of Canada has forecast annualised growth of 1.5% in the third quarter.
- Money markets are pricing in a 25-basis-point rate hike in December, even as most economists have called for no change in interest rates throughout the year.
- The Canadian dollar was trading down 0.06% at C$1.4179 to the US dollar, or 70.53 US cents. Yields on two-year government bonds were down 3.1 basis points at 2.567%.
