The Canadian economy managed to eke out growth despite the impact of raging wildfires in July, Statistics Canada said Friday, but early estimates for August were less rosy.
Canada’s real gross domestic product was up 0.2 per cent in July, StatCan said, a notch above economists’ expectations. That boost was owed largely to services-producing industries in the month, including the public sector.
Retail trade posted the largest jump in July, with a full percentage point of growth marking the largest gain in the sector since January 2023. Gains in activity at motor vehicles and parts dealers in the month more than offset declines in June when a technical glitch disrupted sales at dealerships.
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Wildfires were impacting several industries in July, however, with warehousing and transportation seeing its second consecutive monthly contraction. Some rail transportation was forced to shutdown at the end of the month amid wildfires through Jasper National Park and the Rocky Mountains, the agency noted.
Wildfires also shuttered iron ore mines in parts of Labrador and Northern Quebec, and disrupted the summer tourist season in Western Canada.
Looking ahead to August, StatCan said it projected real GDP was essentially unchanged in the month thanks to more declines in manufacturing, transportation and warehousing. Early estimates for August will be revised at the end of October.
The latest figures for August and July come after Statistics Canada reported the economy grew 2.1 per cent on an annualized basis in the second quarter.
The Bank of Canada’s latest forecasts call for annualized growth of 2.8 per cent in the third quarter, but economists and the central bank itself have recently warned that actual output in the period may end up softer than first expected.
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