Canada's Economy Sees Strong Rebound in Q2
Canada's economy showed signs of rebounding in Q2, following a surprise contraction in Q1. According to Statistics Canada, real GDP rose by 3.3% in Q2, which is the fastest quarterly pace of growth since early 2023.
The growth was driven by exports, which jumped 3.6%, led by a rebound in passenger car and light truck shipments. Residential investment also contributed to the economy's growth, as the resale housing market heated up over the spring in provinces like Ontario, Quebec, and British Columbia.
Business capital investment rose by 2.3% in Q2, snapping a five-quarter streak of decline. Spending on machinery and equipment reached its highest level in two years, with investments in computers and peripherals increasing by 16.7%. This growth was attributed to the processing units used in data centers.
The higher gas prices resulting from the war in Iran boosted corporate incomes in the energy sector but also increased input costs for manufacturing firms.