Canadian Dollar Resumed Rally Despite April Economic Growth Missed Forecast

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Canadian economy grew moderately in April since a contraction in good-producing industries mostly offset an expansion in service-producing industries. The Gross Domestic Product report released by Statistics Canada today showed that the economic activity in Canada expanded 0.1 percent in April following a 0.1 percent advance in March and 0.2 percent rise in February. The reading missed the concensus forecast of 0.2 percent from the Bloomberg survey. From a year earlier, Canadian Gross Domestic Product edged up at the rate of 2.1 percent in April, same with the annualized rate in the previous month and below the median expectation of 2.3 percent of economists polled by the survey.

Canadian economic growth in April was mainly attributable to the expansion in service-producing industries. Of all sixteen sectors in the service-producing industries, thirteen sectors reported gains in outputs, led by advances in wholesale trade (1.3 percent), retail trade (0.8 percent), and real estate and rental and leasing (0.4 percent). On the contrary, good-producing industries shrank 0.3 percent with the largest decline in utilities productions (0.1 percent). Moreover, agriculture and forestry, mining and oil and gas contraction and construction sectors all reported notable falls by 0.6 percent in their outputs that trimmed gains in Canada’s April total products.

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Samuel Rae is an active retail trader across a variety of assets, including currencies, stocks and commodities and the author of Diary of a Currency Trader (Harriman House). His personal strategy focuses primarily on classical technical charting patterns with a fundamentally supportive bias, combined with a strict, risk management-driven approach to entries and exits. He is an Economics graduate from Manchester University, UK.