Timing of Next Rate Hike in Question After Surprise Stall in August GDP
Signs that economic growth stalled over the summer have some economists debating the timing of the Bank of Canada’s next interest rate hike. Statistics Canada said Friday that real gross domestic product was essentially unchanged for a second straight month in August. That fell short of economists’ calls and the agency’s own early expectations for a gain of 0.2 percent in the month.
Real gross domestic product in Canada remained unchanged for the second consecutive month in August, falling short of economists’ expectations. This slowdown was partly driven by a decline in wholesale trade, particularly in the motor vehicle sector, due to lower imports and reduced manufacturing activity. A prolonged shutdown at a major auto assembly plant contributed to the contraction in motor vehicle manufacturing.
- Real gross domestic product was unchanged in August, marking the second consecutive month of stagnation.
- This performance missed economists’ forecasts and the agency’s initial expectations for a 0.2 percent gain.
- Wholesale trade decreased by 1.4 percent in August, with most subsectors experiencing a contraction.
- The motor vehicle and parts wholesale sector saw its first decline in seven months, attributed to lower imports and weaker manufacturing.
- Motor vehicle and parts manufacturing fell by 5.8 percent in August, influenced by a major auto plant’s extended summer shutdown.
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