Canadian economy grew by 1.8 per cent in Q2: StatsCan

Canada’s economy expanded at a 1.8 per cent annual pace during the second quarter of 2012, the same growth seen at the start of the year and slightly better than what economists were expecting.

According to a new Statistics Canada report, an increase in business investment was the biggest factor contributing to growth. Business investment in plant and equipment grew at a non-annualized rate of 2.3 percent, the fastest pace in a year. Business inventories also increased substantially, and housing and consumption advanced, as well.

Economists had been expecting a 1.6 per cent gain. The Bank of Canada, however, had been forecasting the 1.8 per cent gain that came to be. For comparison purposes, the U.S. economy expanded at a 1.7 per cent annual pace during the same period.
But exports slowed and imports rose substantially, it’s still the third quarter in a row for sluggish economic performance below two per cent. But the central bank, which says it may have to hike interest rates at some point, expects growth to accelerate from now through 2013.

In June, gross domestic product grew 0.2 per cent from May.