TD Securities says Canadian trade data beat expectations and employment rose for
a second month, albeit modestly, signaling the economy is running at a low pace
and appears to have avoided recession. Together with April GDP, the trade upside
reinforces expectations for a Q2 rebound after two weak quarters; trade gains
could drive growth but remain fragile amid rising trade-policy uncertainty that
is denting business and household confidence. With little sign that recent
oil-price increases are transmitting to broader inflation, TD expects the BOC to
keep policy rates unchanged at the next meeting.
