07:43 AM EDT, 08/30/2024 (MT Newswires) -- Canada will publish Q2, June and preliminary July gross domestic product (GDP) data at 8:30 a.m. ET on Friday, noted Bank of Montreal (BMO).

Canadian economic growth likely picked up a touch in Q2, with GDP expected to rise 2.0% annualized, said the bank. That still trails population growth by a wide margin, driving per capita GDP lower for a fifth straight quarter.

Rate cuts only just started toward the end of the quarter, and it will take time for the impact to feed through to activity, pointed out the bank. While consumers are under pressure, population growth provides a lift to consumption, which looks to grow about in line with GDP.

Government spending also looks to perk up in an effort to keep up with population growth and infrastructure needs. Business investment likely remained subdued, while housing was a modest drag. Finally, net exports are expected to trim 0.5-to-1 ppt from the headline, with inventories about neutral.

June GDP will be released at the same time and BMO is anticipating a flat reading, a tick below the flash estimate. Manufacturing activity plunged, while wholesale softened and retail volumes were little changed. The broadly weaker backdrop was also reflected in the 0.4% drop in hours worked.

Higher home sales were one bright spot, but that only offsets a small portion of the weakness elsewhere. Meantime, the flash estimate for July could see a decent rebound with the bounce in the manufacturing and retail sales flashes and surge in hours worked, added the bank.

BMO doesn't expect anything in this report to change the calculus for the Bank of Canada (BoC) at its September policy announcement with a 25 bp rate cut expected.

The Canadian dollar (CAD or loonie) is little changed at $1.348/USD (74.2 US cents) to start Friday, according to the bank.