Canada Logs Strongest Quarterly Growth in Over Three Years Amid One-Off Boosts

Canada's economy saw its best quarterly growth in more than three years, according to official data released on Friday. The country's GDP grew by a greater-than-expected 0.3% in May and is projected to reach an annualized 3.4% for the second quarter.

The figures surpass the Bank of Canada's forecast of 2.5% growth for the same period, which was made public just last week on July 15. The central bank maintained its benchmark overnight rate at 2.25% and stated that growth would strengthen in the second half of the year as inflation pressures eased.

Economists point to several one-off factors contributing to the strong numbers, including the FIFA soccer World Cup, hiring for a national census, and oil facilities delaying maintenance to capitalize on higher prices.

Despite these boosts, analysts caution that the economy's underlying strength is still limited. Money markets are pricing in a hold on rates for the remainder of the year, with some economists suggesting that slack in the economy will continue to fade slowly.