Fed Decision Day | Canadian GDP Increases for Third Consecutive Month
Published July 31, 2019
The US Federal Reserve is set for its first monetary easing cycle in a decade later this afternoon. Policy makers at the Federal Reserve are widely expected to lower the federal funds rate by a quarter point when they complete their two-day meeting this afternoon. Market participants will be anxious to gauge the tone of Chairman Jerome Powell’s press conference and whether he will give any hints on future easing.
Canadian GDP data was released this morning with real gross domestic product up for a third consecutive month in May, rising 0.2%. The increase was led by a rebound in manufacturing, with 13 out of 20 industrial sectors expanding. Goods-producing industries rose 0.6%, up for a third month after declining since the third quarter of 2018.
US private sector employment increased by 156,000 jobs from June to July according to the July ADP National Employment Report. The vice president and co-head of ADP Research stated, “While we still see strength in the labor market, it has shown signs of weakening.”
The Canadian Industrial Product Price Index declined 1.4% in June, the largest decrease since July 2017. Prices for products manufactured in Canada were down 1.4% in June, driven primarily by lower prices for energy and petroleum products. Prices for raw materials purchased by manufacturers operating in Canada decreased 5.9%, mainly due to lower prices for crude energy products.