November GDP strengthens, signals Q4 growth

Mon Jan 31, 2011 10:50am EST
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Leah Schnurr

OTTAWA (Reuters) - Canada's economy racked up the strongest growth since March 2010 in November and solidified expectations for a more robust economic performance in the fourth quarter.

The economy grew 0.4 percent in November due to increased oil and gas extraction as well as higher wholesale and retail prices, Statistics Canada said on Monday.

Analysts polled by Reuters had expected gross domestic product to climb by 0.3 percent after a 0.2 percent gain in October.

Economists said the November figures bode well for fourth-quarter GDP achieving the 2.3 percent growth forecast by the Bank of Canada. The economy grew by 1 percent in the third quarter.

"The Canadian economy looks to have ended 2010 on an upswing after a mid-year lull, churning out its best monthly growth rate since last March," wrote Doug Porter, deputy chief economist at BMO Capital Markets.

He said, however, that the GDP numbers are unlikely to push the central bank into a quick move to raise interest rates.

"Still, growth is not yet so strong to soon shake the Bank of Canada off the sidelines -- we would need to see a few more months of this kind of strength -- as three- and six-month trends in GDP growth remain a bit below 2 percent."

Other data released on Monday by Statistics Canada showed producer and raw materials prices topped forecasts in December, lifted by petroleum and metals.   Continued...