Canada's Economy Shows Signs of Gradual Recovery Amid US Inflation Concerns

Canada's economic calendar will be quiet next week after recent data pointed to improving domestic conditions.

Economic activity rebounded in Q2, supported by stronger household spending and business investment. Trade disruptions that dragged on earlier have largely faded.

The pace of growth is unlikely to be sustained, but the trend remains consistent with a gradual recovery. Labour market conditions have stabilized, with employment falling 42,000 in August after three months of firm job growth.

Next Friday's Q2 national balance sheet accounts are expected to show an increase in household net worth due to rising financial assets and stabilizing housing markets. The TSX Composite Index rose 6.4% in the quarter, while the S&P 500 rebounded 17.2%.