Canada’s economy grew 2.1% at an annualized rate in the second quarter beating forecasts on increased government spending and higher wages, Statistics Canada said on Friday.
This was greater than the 1.8% expected by analysts surveyed by Bloomberg and the Bank of Canada’s 1.5% estimate from July.
On a per capita basis, however, GDP fell 0.1% in Q2 marking the fifth consecutive quarterly decline.
Government spending increased 1.5% in Q2 on higher wages and an increase in hours worked across all levels of government.
Employee compensation was up 1.6% on strong wage growth in mining and oil and gas extraction, health care and social assistance, educational services, and finance and insurance.
Business spending on engineering structures, machinery and equipment was up 6.5% led by spending on aircraft and other transportation equipment and parts.
Household spending slowed by 0.2% after increasing 0.9% in the first quarter.