Canadian March and Q1 GDP

Canada GDP
  • February was +0.4% (unrevised)
  • Q1 GDP annualized+5.6% vs +6.8% expected
  • Q4 2020 GDP was +9.6% annualized
  • Canadian GDP +6.6% y/y vs +6.5% expected
  • April prelim estimate -0.8% m/m
  • Full report

At first blush, the Q1 miss must be due to earlier revisions because the y/y number was higher than anticipated.

The April decline isn’t a surprise given the harsh lockdowns in much of the month — many of which are continuing.

Total growth is about 1% below the Feb 2020 level before the pandemic, which should be mopped up in Q2 or Q3 depending on the reopening

Overall, the market reaction has been minimal, with USD/CAD down 31 pips to 1.2031 today.

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