06:54 AM EDT, 10/28/2024 (MT Newswires) -- The Canadian gross domestic product report for August on Thursday will likely reveal more softness in the economy with no growth in line with Statistics Canada's preliminary estimate a month ago and down from 0.2% month-over-month growth in July, said RBC.

A slowdown will be seen in both goods and services, stated the bank. The manufacturing sector likely saw a decline in output, given that sales and volumes were down in August.

However, that decline was partially offset by higher output in mining, oil and natural gas. Wholesale sale volumes declined by 0.7% month over month in August and RBC's tracking of credit card transactions is pointing to a pullback in hospitality services, but retail sales and home resales increased.

The early estimate for September GDP will also likely remain soft, according to the bank. Hours worked declined 0.4% month over month in September -- leaving GDP per capita tracking a sixth consecutive quarterly decline.

That would extend a historically unprecedented underperformance on a per-capita basis versus the United States economy, where RBC expects Wednesday's US GDP for Q3 to show another solid 3% gain, faster than Q2.

This is consistent with why RBC expects more interest rate cuts from the Bank of Canada than the US Federal Reserve in the year ahead.