Impressive 2Q Won't Sway Bank of Canada Given Trade Conflict
Dow Jones
Aug 28
0919 ET - Canada had impressive economic growth in 2Q, but that will be yesterday's news as far as the Bank of Canada is concerned, says Andrew Grantham, economist at CIBC Capital Markets. The sharp escalation in trade tensions between the U.S. and Canada hangs over the economic outlook, and Grantham adds the monthly GDP data suggest activity slowed in July. The 3.3% annualized gain in GDP suggests a slightly narrower output gap, or the measure of slack in the economy. Still, the Statistics Canada estimate of flat growth in July has GDP tracking toward a slower 1.5% rise in 3Q, and Grantham says CIBC does not expect the BOC "to move off the sidelines anytime soon."
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