Earlier today, Statistics Canada data showed that the Canadian economy recorded no growth in July, compared to expectations of 0.1% growth, and after a 0.2% decline in June.
Preliminary figures for August indicate 0.1% expansion.
The Canadian economy is now on track to increase 0.2% in Q3 - well below the Bank of Canada's 1.5% forecast published in its July Monetary Policy Report.
However, economists are divided on the implications of today's reading - with some believing the data to be unequivocally negative - while others believe the reading to in fact, indicate resilience in the Canadian economy.
Here's a roundup of economist commentary:
TD (TSX:TD) Economics: The Canadian economy shows "a magnitude of decline typically only seen during recession"
Robert Kavcic, Senior Economist and Director at TD Economics believes that today's data shows a crumbling Canadian economy, pointing out that "In per capita terms, Canada’s real GDP is now on track to be down more than 2% y/y in Q3, a magnitude of decline typically only seen during recession."
He also notes that Canada's real GDP per capita has been essentially unchanged since the end of 2016, compared to 1.7% annualized growth in the U.S.
Scotiabank (TSX:BNS): "A sign of resilience that the economy has yet to contract"
"In fact, it’s a sign of resilience that the economy has yet to contract despite everything that mother nature and striking workers have thrown at it."Looking ahead, Holt remains "cautiously optimistic that the economy can still squeeze out modest growth over the duration of the year."
CIBC (TSX:CM): "Swings in monthly GDP have been driven mainly by supply disruptions"
On the whole however, and looking at economic data such as retail sales, Grantham believes there is enough "evidence that domestic demand is responding to higher interest rates", and that is should be enough to keep the Bank of Canada on hold for the rest of the year.