Canada: Monthly GDP likely to moderate to 0.3% in April - TDS

TD Securities analysts suggest that Canada’s monthly GDP growth is forecast to moderate to 0.3% in April on the heels of a 0.5% increase the prior month.

Key Quotes

“We had originally called for 0.2% growth in April but were forced to revise our forecast after a significant upside surprise on April wholesale sales.”

“Goods-producing industries should drive the headline print, reflecting further gains to energy output and strong residential construction, which will offset a modest drag from manufacturing, owing to a one-off decline in auto production.”

“Elsewhere, services will benefit from a rebound in real estate activity and strong wholesale sales, although soft retail sales will weigh on the sector. A 0.3% headline print should provide some comfort to policymakers concerned over global headwinds, and keep Q2 GDP tracking well above the Bank of Canada's 1.3% projection from April.”