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Canada GDP April 2023

Canada: Economy flatlines in April; flash estimate points to rebound in May

GDP was flat in month-on-month seasonally-adjusted terms in April, which was a deterioration from March’s 0.1% increase and below the initial estimate for 0.2% growth. Growth was recorded in the energy, construction, culture and hospitality subsectors. However, strikes led to a contraction in public-sector output.

On an annual basis, monthly GDP grew 1.7% in April, which was below March’s 1.8% expansion and marking the worst result since February 2021.

A flash estimate points to 0.4% month-on-month growth in May, thanks to the manufacturing and wholesale trade subsectors. Moreover, public-sector output should recover thanks to the deal reached on 1 May that ended the labor dispute.

On the latest data, TD Economics’ Marc Ercolao said:

“Canadian GDP surprised to the downside, but details didn’t flash any major warning signs. With [April’s] print and the flash estimate for May, second quarter GDP growth is tracking around a trend pace. This would once again overshoot the Bank of Canada’s (BoC) most recent 1.0% annualized estimate for Q2 growth.”

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