09:06 AM EDT, 07/31/2024 (MT Newswires) -- Canada's economy did marginally better than CIBC expected in the closing months of Q2 while registering a "medal winning" performance when judged in terms of per capita output gains, said the bank.

Wednesday's monthly gain of 0.2% m/m in real GDP in May (rounded up from 0.156%), and the advance estimate for a 0.1% m/m pace in June, point to a Q2 growth rate of just over 2% annualized. While that's about a half point faster than CIBC's forecast for the quarter as a whole, these GDP-by-industry numbers can regularly diverge by that magnitude from the more prominent quarterly national expenditure accounts estimates.

May's growth was also given a strong lift from the public sector, which accounted for about half of the total gain that month, as growth in manufacturing was countered by weakness in retail and wholesale trade, pointed out the bank.

The Bank of Canada (BoC) is anticipating a stronger Q3 than CIBC's forecast, and the fact that most of the Q3 growth was back in April, with a soft handoff for June, suggests that Canada will need a jump in July to get its forecast back on track.

The data will likely see some small upward adjustments to forecasts for Q2 GDP, but not enough to stand in the way of a further BoC rate cut in September, which is more tied to the progress seen in inflation readings, according to the bank.