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Canada data point to solid Q2 growth near end of June
Wholesale sales in June were estimated to rise 2.7%, adding to signs that Q2 real GDP growth likely beat an earlier 2.2% annualized tracking range.
Action Forex says upcoming Canadian manufacturing and wholesale sales data for June should support readings consistent with continued real economic growth into the end of Q2, following soft readings earlier in April and May.
The outlet cites Statistics Canada estimates that wholesale sales rose 2.7% after the earlier weakness, with gains attributed to stronger sales in machinery, equipment, and supplies, which Action Forex links to a surge in equipment imports from the U.S. in June.
Action Forex also points to additional June indicators, including a 0.4% increase in advance retail sales despite lower gasoline prices and an increase in home resales, as evidence that growth momentum is persisting near quarter end.
While the data strengthen the case for another solid quarter, Action Forex warns that the sustainability of Q2 strength remains uncertain and highly contingent on volatile U.S. trade policy, even as it notes the Bank of Canada may have more room to stay in a data-watching mode given subdued core inflation.
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