Canadian real GDP growth likely to have come in flat in November

The Canadian real GDP growth for the month of November is set to release tomorrow. According to a TD Economics research report, the economic growth is likely to have come in flat with a muted performance throughout goods and services. Real manufacturing shipments shrank almost 1 percentage point during the month, in spite the tailwind from a return to normal operations at Canadian auto plants after U.S. labor disputes disrupted supply chains in October.

Energy is likely to have been a tailwind to growth, thanks to weaker preliminary output in the oil sands, while construction spending for November was weak, potentially in response to unseasonably cool weather in the month.

Looking to services, another strong month for existing home sales will help support real estate while retail sales should provide another source of strength. However, this will be offset by a drag from wholesale trade and transportation, with the latter a key source of downside risk due to the impact from the CN strike. A flat print would leave Q4 growth tracking near BoC projections (0.3 percent), suggesting more excess capacity and disinflationary pressure going forward”, added TD Economics.