Canada Q3 GDP up 2.6% annualized, topping 0.5% expected

• Prior -1.6% (revised to -1.8%)
• GDP Q3 Q/Q +0.6% vs -0.4% prior (revised to -0.5%)
• GDP for September M/M +0.2% vs +0.2% expected
• Prior -0.3% (-0.1%)
• GPD for October preliminary -0.3%

This is a huge surprise for Canadian GDP. The BoC projected +0.5%, so this blows it out of the water (although it was mainly driven by a big fall in imports). The central bank can comfortably sit back and not even thinking about cutting rates further.

StatCan said: “the rise in the third quarter was driven by a strengthening trade balance, as imports dropped and exports edged up. Increased capital investment was driven by government capital spending, as business investment was flat. Overall growth was dampened by declines in household and government final consumption expenditures as well as a slower accumulation of business inventory.”