Loonie Higher as Canadian GDP Grows at the Fastest Pace in 2-Years
- Canadian GDP expanded at the fastest pace in 2-years in Q3
- BoC has previously stated concern over economic performance
- USD/CAD declines to a new 2-day low
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Canada Gross Domestic Product grew by 0.7% (real) in Q3, up from 0.4% in the second quarter. On a monthly basis, the economy expanded by 0.3% in September, beating expectations for 0.2% growth and consistent with the 0.3% expansion in August. Canadian GDP grew by 2.3% from September 2012, according to Statistics Canada. Domestic demand increased 0.5% in the third quarter, while exports fell by 0.5% after three quarters of export growth.
In October, the Bank of Canada did not mention the possibility of a rate increase for the first time in more than a year, and Governor Poloz said this month that he would like to see inflation higher. The BoC also mentioned worse than expected economic activity as a reason for its accommodative stance. Better than expected economic growth may dissuade the BoC from further pursuing accommodative policy, and the release was therefore positive for the Loonie.
USD/CAD has fallen to a new 2-day low and past support at 1.0568, which was the August high, and the pair may next see support by the first monthly pivot support point at 1.0528.
USD/CAD 1-Minute: November 29, 2013
Chart created by Benjamin Spier using Marketscope 2.0
-- Written by Benjamin Spier, DailyFX Research. Feedback can be sent to email@example.com .