The Canadian economy grew 0.4% in April following a 0.2% decline the month prior. GDP for the country was greater than the 0.2% that was expected by economists and was the first month of growth in the last three. A closer look at the breakdown reveals that the downtrodden manufacturing industry rebounded with a 1.9% improvement after declining 2.4% in April. Wholesales sales also saw significant improvement of 2.1%, as the strong Canadian labor market has boosted the outlook for domestic demand. Nevertheless, the economy is only expected to expand 1.4% this year, which would be the lowest since 1992. The BoC is expected to keep their benchmark rate at 3.00% as inflation concerns continue to mount. The rebound in growth will allow the central bank to keep their easing policy on hold as they surprisingly did at their last policy meeting following four rate cuts since December. – John Rivera, Currency Analyst
