And it's all Justine's fault!
Canada’s economy posts ‘blow out’ growth; dollar jumps
Canada's economy continued its hot streak in May, riding broad-based growth led by a surge in oil output, beating already high market expectations and setting off another wave of buying in the high-flying Canadian dollar.
Statistics Canada reported that Canada's real gross domestic product jumped 0.6 per cent in May from April, on a seasonally adjusted basis – triple the solid 0.2-per-cent growth that economists had predicted. That matched the strongest single-month growth that the economy has posted in the past six years. Compared with 12 months ago, real GDP was up 4.6 per cent – the fastest year-over-year growth in nearly 17 years.
The Canadian dollar surged against its U.S. counterpart in the aftermath of the release; by mid-morning, the currency was trading at 80.49 cents (U.S.), up 0.83 cent. This latest evidence of Canada's economic resurgence bolstered expectations that the Bank of Canada will follow up its mid-July interest-rate hike with further increases in the coming months, a prospect that makes the currency more attractive for foreign investors.
"With this powerful momentum, even if some of it is a passing phase, it will take a lot to knock the Bank of Canada off its gradual tightening path," said Bank of Montreal chief economist Douglas Porter in a research report.
"[The GDP numbers] will obviously reinforce the Bank of Canada's new-found confidence in the economy and hawkish stance on interest rates," said David Madani, senior Canada economist for London-based Capital Economics, in a research note.
The highlight of the May GDP report was a 7.6-per-cent surge in oil and gas extraction. The numbers received a one-time juicing from the ramping-up of output at Syncrude's Mildred Lake oil sands upgrader in northern Alberta, which was shut down by a fire in March.
But the economy also enjoyed strength in many other sectors in May, including manufacturing (up 1.1 per cent month over month), finance and insurance (up 0.9 per cent), retail (up 0.9 per cent) and wholesale trade (up 0.7 per cent). Overall, 13 of 18 sectors posted growth in the month.
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Canada’s economy posts ‘blow out’ growth; dollar jumps
Canada's economy continued its hot streak in May, riding broad-based growth led by a surge in oil output, beating already high market expectations and setting off another wave of buying in the high-flying Canadian dollar.
Statistics Canada reported that Canada's real gross domestic product jumped 0.6 per cent in May from April, on a seasonally adjusted basis – triple the solid 0.2-per-cent growth that economists had predicted. That matched the strongest single-month growth that the economy has posted in the past six years. Compared with 12 months ago, real GDP was up 4.6 per cent – the fastest year-over-year growth in nearly 17 years.
The Canadian dollar surged against its U.S. counterpart in the aftermath of the release; by mid-morning, the currency was trading at 80.49 cents (U.S.), up 0.83 cent. This latest evidence of Canada's economic resurgence bolstered expectations that the Bank of Canada will follow up its mid-July interest-rate hike with further increases in the coming months, a prospect that makes the currency more attractive for foreign investors.
"With this powerful momentum, even if some of it is a passing phase, it will take a lot to knock the Bank of Canada off its gradual tightening path," said Bank of Montreal chief economist Douglas Porter in a research report.
"[The GDP numbers] will obviously reinforce the Bank of Canada's new-found confidence in the economy and hawkish stance on interest rates," said David Madani, senior Canada economist for London-based Capital Economics, in a research note.
The highlight of the May GDP report was a 7.6-per-cent surge in oil and gas extraction. The numbers received a one-time juicing from the ramping-up of output at Syncrude's Mildred Lake oil sands upgrader in northern Alberta, which was shut down by a fire in March.
But the economy also enjoyed strength in many other sectors in May, including manufacturing (up 1.1 per cent month over month), finance and insurance (up 0.9 per cent), retail (up 0.9 per cent) and wholesale trade (up 0.7 per cent). Overall, 13 of 18 sectors posted growth in the month.
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