Canada’s economy grew by a better-than-expected 3.7 percent in the second quarter, official figures showed on Friday, good news for Prime Minister Justin Trudeau less than two months before elections.
The uptick — expressed at an annualized rate — came after a disappointing end to 2018, when the economy slowed significantly, and a 0.4 percent rise initially reported for the first three months of 2019.
Analysts had forecast Gross Domestic Product growth of 2.9 percent for the second quarter.
In comparison, GDP in Canada’s neighbor and major trading partner the United States rose 2.0 percent in the same period.
A 3.7 percent jump in exports fueled Canada’s expansion in the April-June period, after shipments declined in the two previous quarters, Statistics Canada said in a statement.
Energy products led the rise in exports.
“The contribution of trade to growth was the largest since 2011,” National Bank of Canada analysts said.
On the other hand, they said, slumping business investment subtracted from growth.
Royce Mendes, senior economist at CIBC Capital Markets, said “the Canadian economy came roaring back following a couple of quarters of near stagnation.”
Neck-and-neck in opinion polls with his Conservative Party challenger Andrew Scheer, Liberal Party leader Trudeau welcomed the growth figures.
“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.
Scheer favors 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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