Canadian economy likely to have grown 0.2 pct in April, goods and services to have driven growth – TD Economics

The Canadian economic growth is expected to have accelerated in April. According to a TD Economics research report, the GDP is likely to have grown 0.2 percent in the month. Both goods and services are expected to have driven the growth, while a deceleration in housing activity is expected to have been a drag. Goods sector output is likely to be restrained by a sharp slowdown in residential construction. In the meantime, services might feel an effect from the decline in resale activity. Elsewhere, GDP growth is likely to have been supported by a rise in manufacturing activity, consumer spending and utilities output.

Shutdowns at an oil sands upgrader is expected to have been a drag on nonconventional oil production; however, this should be countered by the ongoing rebound in oil and gas support services that are up almost 65 percent, stated TD Economics.

The projection of a 0.2 percent monthly rise in industry level growth is in line with the second quarter growth near 3 percent. This should leave the BoC comfortable with the “sustainable” performance in the wider economy as they look to remove the 2015 insurance cuts in the coming months, most likely in October, added TD Economics.

At 22:00 GMT the FxWirePro's Hourly Strength Index of Canadian Dollar was bearish at -90.687, while the FxWirePro's Hourly Strength Index of US Dollar was bearish at -62.388. For more details on FxWirePro's Currency Strength Index, visit http://www.fxwirepro.com/currencyindex

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