Canada: Oil and gas pumps up GDP - TDS

Canada’s industry-level GDP surpassed expectations with a 0.3% advance in April (market: 0.2%) concentrated in oil and gas production; excluding resources, GDP edged slightly lower on the month, explains the research team at TD Securities.

Key Quotes

“While positive, stronger GDP figures are unlikely to hold any implications for BoC policy. We are now tracking Q2 growth at 2.5%, but a fleeting rebound from Q4/Q1 may not be sufficient to counter building headwinds.”

“FX: Despite the positive surprise, USDCAD's reaction has underwhelmed. A consolidation is likely required before rate spread dynamics pull USDCAD lower in the coming weeks.”