Notes From The Desk: Canadian GDP – Sl’oh Canada
This morning, all eyes were on GDP to hint at what the Bank of Canada (BoC) will do at their December 11th meeting.
The numbers.
- Q3 GDP: 1.0% (vs. 1.1% expected).
- September MoM GDP: 0.1% (vs. 0.3%).
- October Advanced Estimate: 0.1%.
- GDP YoY: 1.6%, as expected.
The implications.
The Q3 number will not raise eyebrows, but the September print and October estimate point to slower growth in Q4. If the 0.1% MoM trend continues, it would imply a Q4 growth of 1% versus the BoC forecast of 2%.
Following the government’s ‘Santa Stimulus’, the market leaned towards a 25 bps cut in December. Today’s data puts 50 bps back on the table. Yields are lower by 8 bps, with various factors contributing to the move.
