The Canadian economy surpassed growth expectations last fall, renewing hope that the recession is slowing down.
According to the latest figures from Statistics Canada, the economy grew by 0.3 percent in both September and October, surpassing predictions. Overall the economy grew every month in 2013 excepting June.
“Canada’s economy is showing sustained strength for the first time since the early days of the recovery,” said Sal Guatieri, an economist with BMO Capital Markets.
Experts are optimistic about gains in the manufacturing sector, in particular, which could strengthen the economies of Canada’s most populous provinces – Ontario and Quebec. The gains are likely due to an increasing U.S. demand.
However, despite the signs of economic recovery, the Bank of Canada has not yet raised interest rates, nor has it provided any hint of the intention to do so. The Bank had predicted an overall growth rate of 2.3 percent for the fourth quarter of 2013 but Guatieri says that the October figures are on pace for a 2.6 percent growth.
Overall economic figures are up from the year before, and GDP outputs are growing as well. Canada has gained back nearly all the jobs that were lost since the recession hit in 2007.
Economists predict that the Bank of Canada interest rates will remain unchanged at least until 2015.
Sources: Globe and Mail; Financial Post