OTTAWA. Canada’s economy grew by a better-than-expected 3.7 per cent in the second quarter, official figures showed on Friday, good news for Prime Minister Justin Trudeau less than two months before elections.
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The uptick — expressed at an annualised rate — came after a disappointing end to 2018, when the economy slowed significantly, and a 0.4 per cent rise initially reported for the first three months of 2019.
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Analysts had forecast Gross Domestic Product growth of 2.9 per cent for the second quarter.
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In comparison, GDP in Canada’s neighbour and major trading partner the United States rose 2.0 per cent in the same period.
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A 3.7 per cent jump in exports fuelled Canada’s expansion in the April-June period, after shipments declined in the two previous quarters, Statistics Canada said in a statement.
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Energy products led the rise in exports.
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“The contribution of trade to growth was the largest since 2011,” National Bank of Canada analysts said.
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On the other hand, they said, slumping business investment subtracted from growth.
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Royce Mendes, senior economist at CIBC Capital Markets, said “the Canadian economy came roaring back following a couple of quarters of near stagnation.”
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Neck-and-neck in opinion polls with his Conservative Party challenger Andrew Scheer, Liberal Party leader Trudeau welcomed the growth figures.
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“When you trust in Canadians and invest in them, this is what we can achieve together: a strong and growing economy, over 1 million new jobs, and a better future for our kids & grandkids,” Trudeau said on Twitter.
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Scheer favours a lowering of public spending to reduce a fiscal deficit forecast, according to the federal budget, to reach Can$19.8 billion (US$14.9 billion) for 2019-20.
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