Growth Momentum Remains Strong Amid Trade Uncertainty
Canada's economic growth continues to show resilience despite trade uncertainty and tariffs. The latest monthly GDP report shows that momentum remains solid, with annualized growth of 1.8% in Q3. However, downside risks remain concentrated in the fourth quarter, with potential giveback from front-running tariff-related activities.
The Kitimat LNG expansion and proposed Alberta-to-West Coast pipeline announcements offer significant upside for 2027 and beyond, equivalent to roughly 1% of GDP each.
In the US, revised economic data has revealed a stronger growth profile and softer inflation history. The jobs report showed hiring slowed but remained close to the labor market's breakeven pace, while unemployment edged higher as more workers entered the labor force.
Improved inflation trends alongside softer hiring and wage growth reduce the urgency of an October Fed rate hike.