Canada: Economic growth ebbs in May
GDP reading: GDP was up 0.3% on a seasonally adjusted month-on-month basis in May, following a 0.6% increase in the prior month.
Drivers: Real estate, public administration, mining and energy were key drivers in May. Overall, 13 of 20 industrial sectors contributed to growth.
GDP outlook: Preliminary estimates indicate that real GDP grew by 0.2% in June. Gains in wholesale trade, finance and insurance, and retail trade were partly offset by declines in utilities and in agriculture, forestry, fishing and hunting.
Panelist insight: On the data and outlook, TD Economics’ Marc Ercolao said:
“This was a solid print coming off the heels of April’s strong rebound. May’s GDP gain reinforces confidence in the Bank of Canada’s view that growth resumed in the second quarter, with real GDP tracking around 3.0% annualized, slightly ahead of the Bank’s most recent forecast. It’s increasingly looking like the stalling of growth in the first quarter was more reflective of temporary drags and volatility rather than a meaningful deterioration in underlying activity.”