Canada: Economy rings in 2019 with a bang - TDS

Canada’s industry-level GDP rose by 0.3% in January, beating the market consensus for a 0.1% advance, points out the research team at TD Securities.

Key Quotes

“Strength was broad-based although energy sector headwinds shaved roughly 0.2pp from growth.”

“The strong print helped push our tracking for Q1 growth to 1.1%, slightly above BoC projections (0.8%). This all but eliminates the risk of any near-term easing, although it will take more to put hikes back on the table.”

“FX: A welcome development, though a number of factors continue to point to a problematic strategic outlook for the CAD. We think a near-term positioning cleanse is warranted but the dip in USDCAD should find interest sub-1.33 – where we look to fade.”