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CANADA ECONOMICS: Scotiabank Nowcast; Rise in Exports Nudges Q4 2020 up to 7.82%, Weak January Looms

· 02/05/2021 09:58

02:50 PM EST, 02/05/2021 (MT Newswires) -- Nikita Perevalov, Director of Economic Forecasting at Scotiabank, on Friday said a pair of data releases from Statistics Canada "buttressed" both the robust GDP growth expectations for Q4 2020 (nowcast now at +7.82% Q/Q SAAR) and the looming slowdown in Q1 2021. Perevalov noted the international trade print for December showed exports rising "briskly" (+1.5% m/m), boosted by a strong pickup in energy exports (+10.2% m/m), as both energy prices and volumes posted increases on recovering demand. Forestry products (+5.0% m/m) and aircraft and other transportation equipment (+8.2% m/m) were other important contributors to export growth in December, he added.

In contrast, Perevalov noted, imports slid by -2.3% m/m, mainly due to an outsized pullback in imports of consumer goods (-8.0% m/m), an indication of the "dislocations" caused by the pandemic in consumer spending during the usually-busy holiday shopping season. He said this fall is in line with weak consumer spending at the end of Q4 2020 (recall that Statistics Canada provided preliminary estimates of +0.3% m/m GDP growth for December and a -2.6% m/m decline in retail sales).

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