{"id":15725,"date":"2026-10-09T14:38:59","date_gmt":"2026-10-09T14:38:59","guid":{"rendered":"https:\/\/www.rbc.com\/en\/economics\/?p=15725"},"modified":"2026-10-09T14:39:00","modified_gmt":"2026-10-09T14:39:00","slug":"canadian-industry-data-to-point-to-a-modest-gdp-rebound-in-august","status":"publish","type":"post","link":"https:\/\/www.rbc.com\/en\/economics\/forward-guidance\/canadian-industry-data-to-point-to-a-modest-gdp-rebound-in-august\/","title":{"rendered":"Canadian industry data to point to a modest GDP rebound in August"},"content":{"rendered":"\n
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For the week of October 13th<\/sup><\/strong><\/p>\n\n\n\n


Canada’s economy entered Q3 on a softer footing as activity stalled in July. Statistics Canada’s advance estimates pointed to a 0.2% rebound<\/strong> in August, but declining home resales already released and weaker manufacturing, wholesale shipments expected next Thursday suggest a more modest increase.<\/p>\n\n\n\n

New U.S. Section 338 tariffs targeting 5% of imports from Canada came into effect on August 22. Trade data on Tuesday showed meaningful front-loading<\/a>, with U.S. buyers driving a 40% year-over-year surge in their imports of products on the tariff lists from Canada that month.<\/p>\n\n\n\n

Those products, however, map to a relatively small share of the Canadian economy<\/a>. As a result, front-loading widened trade surplus but is not expected to have meaningfully added to production.<\/p>\n\n\n\n

StatsCan\u2019s advance estimate for August manufacturing sales was up a nominal 1.1%, which rounds to little change in volumes once a similar 1.3% increase in industrial manufacturing prices is taken into account. Wholesale trade also looked softer, with the advance estimate pointing to a 1.5% decline in core sales from July, dragged down by lower shipments of agricultural supplies, vehicles, and parts.<\/p>\n\n\n\n

Those alongside weaker home resale activity<\/a> are suggesting downside risks to StatCan’s preliminary estimate for a 0.2% rise in real GDP in August \u2014 although retail activity likely remained strong and offered some offset, consistent with robust purchases in our RBC cardholder spending tracking<\/a>.<\/p>\n\n\n\n

A more modest rebound in August GDP growth should still leave growth in the third quarter around our 1.8% annualized estimate. That is softer than the 3.2% real GDP growth in Q2 but still solid.<\/p>\n\n\n\n

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Also in focus next week are September home resale data on Thursday, which are expected to show further softening after most early regional real estate boards<\/a> reports pointed to weaker activity that month. Housing starts data on Friday, however, are expected to show some stabilization, with starts rising to 240,000 annualized units in September, up roughly 5% from August.<\/p>\n\n\n\n

Overall, we continue to expect a gradual and uneven recovery in Canada\u2019s housing market, as affordability relief tapers off<\/a> on the back of stabilizing home prices and rising bond yields.<\/p>\n\n\n\n

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