Canada's third-quarter annualized GDP surprises with growth of 2.6%

Economic Growth - Canada's economy grew at an annualized rate of 2.6% in the third quarter, surpassing expectations and avoiding a potential technical recession after a contraction of 1.8% in the previous quarter [2][5] - The growth was primarily driven by a 6.7% increase in crude oil and bitumen exports and a 2.9% rise in government capital investments [5][6] Government Spending - Increased spending on weapon systems and non-residential structures, such as hospitals, contributed significantly to the rise in government investments [6] - A rise in residential resale activity and renovations also supported economic activity [6] Business and Consumer Sentiment - U.S. tariffs on critical sectors have negatively impacted Canadian exports, leading to job losses and subdued business and consumer sentiment [5][7] - Despite the positive GDP growth, the underlying impact of tariffs continues to affect sentiment, indicating a near-recessionary environment [7] Future Outlook - The Bank of Canada is expected to maintain its key interest rate at 2.25% and will only consider changes with significant shifts in the economic outlook [6] - An advance estimate suggests a potential decline of 0.3% in GDP for October, indicating a negative start to the fourth quarter [4]