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2025-07-31 21:43:52
[Canadian Economic Suspense: GDP unexpectedly rebounded, can the central bank's interest rate cut expectations continue?] ⑴ Canada's GDP contracted by 0.1% month-on-month in May, in line with market expectations, mainly dragged down by declining output in the retail and mining industries. ⑵ However, preliminary estimates from Statistics Canada show that GDP is expected to grow by 0.1% in June, which means that the annualized GDP growth rate in the second quarter may reach 0.1%, which is in sharp contrast to the Bank of Canada's previous forecast of a 1.5% contraction. ⑶ Despite this, the market remains skeptical of this optimistic forecast because monthly GDP is based on industry output, while quarterly GDP is based on spending and income, and there may be differences between the two. ⑷ Traders' bets on the Bank of Canada keeping interest rates unchanged in September have risen to about 89%, higher than the level before the GDP data was released, reflecting the market's wavering expectations of rate cuts. ⑸ Analysts pointed out that future inflation and employment data will be crucial. If the central bank restarts interest rate cuts, it may be affected by the continued uncertainty of trade policy and domestic economic headwinds.
