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Economy surprises with 3.7% growth in second quarter, its strongest since 2017

Last Updated Aug 30, 2019 at 5:53 am PDT

Workers are pictured at the Vancouver shipyard in an October 7, 2013, file photo. THE CANADIAN PRESS/Jonathan Hayward

OTTAWA — The economy blew past projections by expanding at an annualized pace of 3.7 per cent in the second quarter, giving Canada its strongest three-month stretch of growth in two years.

Statistics Canada’s latest reading for real gross domestic product shows an unexpectedly solid turnaround for an economy that was coming off its weakest back-to-back quarters of growth since 2015.

The agency says the economy rode a powerful, broad-based rebound in goods exports in the second quarter — led by robust growth in energy products, farming and fishing products, non-metallic minerals and aircraft products.

The report says the headline GDP number was also supported by a one per cent drop in import volumes, compared with a 2.1 per cent increase in the first quarter.

Experts had been predicting a more modest rebound for Canada following its weak first-quarter growth — which was revised up to 0.5 per cent.

Economists had expected growth at an annualized rate of three per cent for the second quarter, according to financial markets data firm Refinitiv.

Earlier this summer, the Bank of Canada had predicted second-quarter turnaround would be 2.3 per cent.

On a month-to-month basis, the report says the economy expanded 0.2 per cent for its fourth-straight month of growth.