Canada’s economy was flat in July with signs of growth in August: StatCan

Canada’s economic growth was “essentially unchanged” in July, Statistics Canada said Friday, but there were signs growth was returning later in the third quarter.

The flat real GDP reading for July came following a modest contraction of 0.2 per cent in June.

Drags in manufacturing were the biggest downward force on the economy in July, with a 1.5 per cent monthly decline marking the largest drop in the sector since April 2021.

The energy sector meanwhile provided some growth in the month, as did bouncebacks in the mining and quarrying and food and accommodations industries, according to the agency.

Early estimates for real GDP in August suggest a 0.1 per cent increase in the month, though StatCan cautions those advance readings can be revised.

The Bank of Canada and many economists have been expecting a period of slower growth for the Canadian economy as higher interest rates cool spending demand and attempt to wrestle inflation back to the central bank’s two per cent target