Canada GDP Growth at Near 6-Year High in Q2


The Canadian economy expanded 1.1 percent on quarter in the three months to June of 2017, following a 0.9 percent growth in the previous period. It is the highest growth rate since the third quarter of 2011, mainly boosted by household consumption and exports of goods. The cumulative growth for the first two quarters of the year was 2 percent, the strongest since 2002.

Household spending on goods advanced 1.9 percent, with outlays on durables, semi-durables and non-durables all increasing. Outlays on services rose 0.5 percent Overall, household final consumption expenditure advanced 1.1 percent in the second quarter, after increasing 1.2 percent the previous quarter.

Growth in export volumes accelerated to 2.3 percent, following a 0.4 percent gain in the first quarter. Exports of goods rose 2.8 percent with energy products (+9.2 percent) contributing the most to the increase. Exports of services edged down 0.1 percent as commercial services fell 0.6 percent.

Imports rose 1.8 percent, about half the pace of the previous quarter. Imports of goods increased 2.5 percent while those of services declined 1 percent.

Business gross fixed capital formation slowed to 0.5 percent growth, following a 3.1 percent increase in the first quarter. The deceleration was mostly attributable to lower investment in housing (-1.2 percent). Business investment in non-residential structures rose 2.4 percent after increasing 1 percent in the first quarter.

Businesses accumulated another CAD 11.5 billion in inventories in the second quarter, after adding CAD 10.5 billion to their stocks in the first. Despite the strong inventory accumulation, the stock-to-sales ratio declined 0.8 percent.

Expressed at an annualized rate, real GDP rose 4.5 percent in the second quarter, above 3.7 percent in the previous period and market expectations of 3.7 percent. It is the strongest growth rate since the third quarter of 2011.

Statistics Canada | Joana Taborda | joana.taborda@tradingeconomics.com
8/31/2017 12:58:30 PM