Canada: GDP expected to print flat – TDS

The focus of the coming week will center around Friday's GDP report for Q4 (expenditure) and December (industry-level). Rounding out the week are the BoC's Lane on Tuesday and payroll employment (Dec) on Thursday. Strategists at TD Securities share their forecast. 

Key quotes

“The market is looking for a 0.3% (saar) increase for Q4, in line with the Bank's projections from the January MPR, though we are slightly more downbeat and look for a flat print. This isn't enough of a surprise to put a rate cut on the table for next week's meeting but given broader sentiment it should put more focus on the April meeting.” 

“The Canadian economy likely came to a standstill in the fourth quarter, with our final growth tracking 0.0% (q/q, annualized). 

“We will also hear from the BoC's Lane when he gives a speech on digital currencies, but we don't expect any implications for near term policy.”

“Turning to the monthly figures TD looks for industry-level GDP to increase by 0.1% in December on a relatively strong showing from the services sector.”