Canada: Q3 GDP likely to print 1.8% in annualized terms - NBF

In Canada, the week will see the release of statistics on third quarter GDP and will be a key economic release, according to analysts at National Bank Financial.

Key Quotes

“Monthly readings to date hint at a positive contribution from business investment (based on strong imports of machinery and equipment) and consumption spending (if rising retail sales are any guide).”

“Trade could also have added to growth, the result of slumping imports in the quarter. Residential construction, for its part, should act as a drag, reflecting a sharp retreat in housing starts. All told, we’re expecting Q3 GDP to come in at roughly 1.8% in annualized terms, less than the 2.9% print registered in Q2, but enough to keep our annual growth target for 2018 unchanged at 2.0%.”

“Looking at monthly data, the handoff to Q4 looks decent, with September GDP on pace to expand 0.1% m/m, courtesy of a strong gain in the retail sector.”

“On Thursday, balance of payments data for the third quarter could show the current account deficit narrowing to around C$11.5 billion, led by an improvement in the goods trade balance.”