Scotiabank Sees Little Impact on Bank of Canada's Thinking From Friday's GDP Data

08:19 AM EST, 02/27/2026 (MT Newswires) -- Canada gets a trio of gross domestic product readings at 8:30 a.m. ET on Friday, said Scotiabank.

Key will be how it relates to the Bank of Canada's expectations for 0% Q4 growth and a 1.8% rebound in Q1, noted Scotiabank.

Q4 GDP is expected to be soft with consensus at 0.2% quarter-over-quarter seasonally adjusted (SA) contraction, and estimates ranging from a low of -0.9% to a high of +0.5%, stated the bank. That would follow the trade-influenced surge in Q3.

Details will matter in terms of drivers like underlying momentum in the domestic economy reflected in final domestic demand and particularly the consumption and investment components, pointed out Scotiabank. Government and net international trade are expected to be positive drivers.

There are likely to be upward revisions to trade contributions to Q3 growth given the data since the estimates were offered, but it's uncertain how this could affect other GDP components like inventories.

GDP for December is expected to be up by 0.1% month-over-month SA based on Statistics Canada's preliminary 'flash' reading of about a month ago. That would extend a soft trend as two of the prior four months were down and one was flat.

The preliminary estimate for January GDP will help to inform early tracking for Q1 GDP growth when combined with how 2025 ended, added the bank. There is little to go by in terms of advance readings.

Little impact on BoC thinking is expected from these readings, given Governor Tiff Macklem's message of general patience, but he'll have an opportunity to comment on the figures next week, according to Scotiabank.

MT Newswires does not provide investment advice. Unauthorized reproduction is strictly prohibited.