UPDATE 3-Canada economy grows 0.3 pct in Aug, outlook modest
* Economy grows 0.3 pct in August vs forecast of 0.2 pct
* Oil and gas extraction expands 2.8 pct
* Non-farm payroll employment rises by 51,300 in August
* Canadian dollar firms after data
By Louise Egan
OTTAWA, Oct 31 (Reuters) - Canada's thriving oil and gas industry helped the economy grow by 0.3 percent in August from July, confirming modest growth that is expected to keep the Bank of Canada's key interest rate on hold for more than a year.
The monthly gross domestic product data, released by Statistics Canada on Thursday, showed the economy continues to bounce back from a downturn in June caused by severe flooding in the nation's oil capital Calgary and a strike by construction workers in Quebec.
The economy contracted 0.5 percent in June and then unexpectedly surged by 0.6 percent in July. Continued...