Canadian GDP Grew 2.6% in 2016

Canada’s indefatigable households and a sharp drop in imports kept the country’s economy growing at a 2.6 percent annualized pace in the final quarter of 2016, helping offset what looks to be a deepening slump in business investment.

Statistics Canada also raised its third-quarter growth estimate to 3.8 percent, from 3.5 percent, showing the nation’s economy had its best half-year performance since the final six months of 2013, or before the collapse of oil prices.

The confirmation that Canada is emerging from the commodity slump should come as a relief to policy makers who struggled to cope with a near-stagnant economy, as the nation dealt with the impact of an oil price shock and faltering export sector.

It will also test Bank of Canada Governor Stephen Poloz’s resolve in asserting that the nation’s economy is lagging considerably behind the U.S. in terms of economic slack. The U.S. economy expanded at a 1.9 percent pace in the fourth quarter.

For the month of December, GDP was up 0.3 percent, Statistics Canada reported.
Economists had estimated a 2 percent annualized gain in the fourth quarter and a 0.3 percent increase in December, according to a Bloomberg survey.

via Bloomberg

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Alfonso Esparza

Alfonso Esparza

Senior Currency Analyst at Market Pulse
Alfonso Esparza specializes in macro forex strategies for North American and major currency pairs. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends. Alfonso has also worked as a professional currency trader focused on North America and emerging markets. He has been published by The MarketWatch, Reuters, the Wall Street Journal and The Globe and Mail, and he also appears regularly as a guest commentator on networks including Bloomberg and BNN. He holds a finance degree from the Monterrey Institute of Technology and Higher Education (ITESM) and an MBA with a specialization on financial engineering and marketing from the University of Toronto.
Alfonso Esparza