Canada economy has biggest quarterly drop in seven years – IOTW Report

Canada economy has biggest quarterly drop in seven years

OTTAWA (Reuters) – Canada’s economy shrank in the second quarter, its worst showing in seven years, hurt by a drop in exports and a disruption to oil production caused by wildfires in Alberta, though growth was seen as likely to rebound later this year.

While the quarterly drop slightly exceeded market forecasts, economists were encouraged by other figures released on Wednesday that showed the economy resumed growing in June.

They said the June pickup supports the Bank of Canada’s view that growth will recover in the third quarter. The central bank is not expected to move off the sidelines at its meeting next week. [CA/POLL]

“I think the Bank of Canada is still confident that exports will turn up and lead the economic expansion in the second half of the year,” said Sal Guatieri, senior economist at BMO Capital Markets.

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