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Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
CANADA DATA
- Real GDP was softer than expected in Q3, slowing to -1.1% annualized (cons 0.1) for worse than any analyst expected and far below the +0.8% the BoC had forecast in its October MPR.
- However, the impact was offset by a large upward revision to Q2, now seen at 1.4% vs the prior -0.2%.
- There’s a lot to unpack within the details. Contrary to the swing in GDP growth rates, final domestic demand has been very consistent for the past two quarters, printing 1.3% after 1.2% and probably exactly the sort of below-trend pace the BoC would want to see to dampen inflationary pressures in a controllable manner.
- What’s changed from a GDP perspective is that net exports have swung from a 0.0pps non-annualized contribution to -0.3pp (mainly on export weakness, with a 5% annualized contraction the largest since 2Q21) and the change in inventories switching from 0.0pp to a -0.2pp non-annualized drag.
- That said, the latest steady domestic demand growth belies an oversized contribution from the public sector. Government consumption surged 7.3% annualized in Q3 for its strongest since 2H20 and before that 2008.
- Private sector demand was much weaker: household consumption increased 0.1% annualized after -0.1% whilst business investment fell 2% after a rare 4.5% increase back in Q2.
- As for the strong Q2 upward revision, it was led by business investment (4.5% annualized vs initial 1.6%) and changes in inventories (0.0pp non-annualized vs -0.2pp). Net exports also helped (0.0pp non-annualized vs -0.1pp) as stronger export growth (5.1% vs 0.4%) was in large part offset by stronger import growth (4.4% vs 1.9%).
Why MNI
MNI is the leading provider
of intelligence and analysis on the Global Fixed Income, Foreign Exchange and Energy markets. We use an innovative combination of real-time analysis, deep fundamental research and journalism to provide unique and actionable insights for traders and investors. Our "All signal, no noise" approach drives an intelligence service that is succinct and timely, which is highly regarded by our time constrained client base.Our Head Office is in London with offices in Chicago, Washington and Beijing, as well as an on the ground presence in other major financial centres across the world.
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