Canada Factories Power Economy to Fourth Straight GainAndrew Mayeda
Canada’s gross domestic product expanded for a fourth straight month in October, led by growth in manufacturing and wholesale trade.
Output rose 0.3 percent to an annualized C$1.60 trillion ($1.51 trillion), Statistics Canada said today in Ottawa. Analysts surveyed by Bloomberg forecast a 0.2 percent expansion, based on the median of 15 estimates.
The data support the Bank of Canada’s outlook that momentum in the world’s 11th largest economy is building after a slowdown earlier in the year. The central bank forecast in October that growth would accelerate to a 2.3 percent annualized pace in the current quarter before reaching 2.6 percent at the end of next year.
The figures suggest the Canadian economy got off to a “fairly decent start” in the final quarter of the year, CIBC World Markets economist Peter Buchanan said in a research note. The results should be “modestly supportive” for the Canadian dollar and may weigh on bonds.
The country’s currency held onto gains following the release, trading at 1.0598 per U.S. dollar at 9:08 a.m. in Toronto. One Canadian dollar buys 94.36 U.S. cents. Canada’s benchmark 2-year government bond was little changed, with the yield holding at 1.11 percent.
Manufacturing expanded by 1.3 percent in October following a 1.2 percent rise the month before, led by non-durable goods such as chemicals, food and beverages, according to Statistics Canada.
Wholesale trade grew 1.4 percent on gains in sales of machinery, equipment and supplies, the agency said.
Oil and gas extraction fell 0.8 percent in October, Statistics Canada said, while construction output was little changed.
From a year earlier, GDP grew 2.7 percent in October, the fastest pace since a 2.9 percent increase in May last year, Statistics Canada said. The agency revised September’s gain to 2.4 percent from an initial 2.3 percent estimate.
Statistics Canada said in a separate report that average weekly earnings of non-farm payroll employees rose 1.4 percent in October from a year earlier, while the average number of hours worked fell to 32.9 per week from 33.1 over that period. The number of workers on payrolls rose 0.1 percent in October from September, or by 16,900.