🇨🇦❗️Cable FX Macro Weekly Note: Canada GDP Growth

**As seen in Risk In The Week report 09/22/23, subscribe at cablefxm.co.uk/reports

Canada’s economic output increased by 1.1%Y/y in June, the rate eased from a prior 1.9% and missed the consensus median forecast of 1.4%. Statistics Canada reported a monthly contraction of 0.2%, this was in line with economists’ expectations. Second quarter output was released along with the June figures, the metric showed a surprise contraction of 0.2% as the consensus had seen a +1.2%. Housing investment, inventories, and net exports dragged growth lower, while household consumption dipped to 0.2% from 4.7% in Q1. Housing investment recorded an fifth consecutive quarterly drop as it contracted by 8.2% in Q2. Statistics Canada flash estimate for July output was seen as flat. Prospects for further BoC tightening were watered down on the surprise contraction, we will have to look if the economy is set for a rebound in Q3, however, the July data point might come to disappoint on this. Economists at CIBC expect July data to support a rebound in Q3 output, however, they expect to see further evidence that domestic demand is pressured by higher rates. They see the housing market easing again while consumer spending on services cools down.