Canadian Economy Expands Faster-than-Expected 2.9%


Canada's economy grew at a faster- than-forecast 2.9 percent annualized rate between July and September as business spending surged, easing pressure on the Bank of Canada to lower interest rates.

Growth in the second quarter also was revised higher to an annualized 3.8 percent, Statistics Canada said. On a monthly basis, the economy grew 0.1 percent in September, down from 0.2 percent in August and in line with economists' forecasts.

Canada's currency has depreciated 10 percent since touching an all-time high 90.58 cents per U.S. dollar on Nov. 7, amid worries that slowing growth may prompt the central bank to lower interest rates as early as its next decision Dec. 4.

Canadian dollar is up 17 percent against its U.S. counterpart since Dec. 29, 2006, and had gained as much as 27 percent this year, fueling concerns it would be a major drag on growth.

Imports jumped an annualized 19 percent in the third quarter, while growth in exports slowed to 2.3 percent from 3.1 percent in the second quarter, the statistics agency said.

 


TradingEconomics.com, Bloomberg
12/4/2007 6:16:09 AM