Forex »

Fall In Canadian GDP

Finances
Share on StockTwits
Published on
www.finances.com
Fall In Canadian GDP

The Canadian economy is continuing its expansionary phase according to the updated official Gross Domestic Product (GDP) data published this morning by Statistics Canada.

The headline GDP number for the month of March has been released at 2.1% on a year on year basis. The previous month’s number was 2.5% and the consensus market estimate was for a slowing in the pace of growth to 2.3%.

The shorter term month on month measure shows that the Canadian economy expanded by 0.1% on the month, this represents an decrease on the February posting of 0.2% and also meets the market expectation for 0.1% monthly growth.

Finally, the Annualized version of the Quarterly figure relating to the first quarter of this year has been calculated at 1.2%, there is a fallback here from the previous quarters reading of 2.9%, the market participants polled suggested an expected figure of 1.8% for the quarter.

Two other pieces of data also released this morning relate to the inflation situation on the production side. Firstly, the Industrial Product Price index for April showed a month on month reading of -0.2%, this is lower than the 0.4% experienced in the prior month and also below of the expected 0.3% prices increase. Secondly, the Raw Materials Price index month on month for April has been published at 0.1%, this is down on the prior month’s 0.7% reading and short of the market expectation of 0.4% prices growth.

The Bank of Canada (BoC) is holding it’s monthly meeting next Wednesday, the key policy interest rate announcement is not considered likely to contain any surprises and the Bank is very much expected to hold the benchmark rate at the 1% level where it has been since mid 2010. Canadian central bankers are however beginning to come under pressure to introduce some policy tightening in the face of an asset bubble that is forming in the housing market.

Share on StockTwits