Preview: Due September 29 - Canada July GDP - Subdued start to Q3

We expect services to rise by 0.1% after a strong 0.4% rise in June that was led by retail and wholesale, both of which are likely to see corrections in July. Arts, entertainment and recreation are likely to see only a partial correction from a June rise that was due to the World Cup, with games in Canada continuing in early July. We expect a 0.2% decline in goods, led by manufacturing.

While employment saw a weak month in August we expect the preliminary August estimate for GDP will be for a modest rise. Fresh trade tensions with the US however pose risks for September. Q3 GDP looks likely to see a modest rise, but considerably slower than Q2’s 3.3% annualized.