TORONTO, Oct. 16, 2020 /CNW/ - BMO's Canadian Business
Activity Index rose 2.6 per cent in August, and is on pace for a
1.7 per cent gain in September, according to BMO Economics.
"This would mark five consecutive months of growth from the
pandemic low set in April, leaving the index 3 per cent below
February's peak," said Robert
Kavcic, Senior Economist, BMO Capital Markets. "Looking at
it another way, about 87 per cent of the economic hole caused by
the pandemic has been filled back up."
Almost all indicators that make up the index continued to
support the rebound in August. Hours worked posted another solid
2.9 per cent gain as the job market recovery progresses. The
upside-surprise in housing continued, with sales and starts both
rising strongly in August, though momentum began to ebb in
September. But, manufacturing sales fell after a strong run (we
await August readings on wholesale and retail trade). Sentiment
measures from the CFIB and equity market remained supportive, but
business credit growth was soft again in August.
"The Canadian economic recovery continues, with business
activity improving again in August," noted Mr. Kavcic. "But,
momentum is fading, as suggested by some of the early September
data, and we continue to believe the task of filling the remaining
COVID hole will be much, much tougher than it was to this point.
That is, some industries are still a long way from returning to any
semblance of normal, while a second wave of cases is prompting some
localized restrictions of activity as we head deeper into the
fall."
The BMO BAI is compiled from ten monthly indicators, with
supporting information from Statistics Canada's preliminary
estimates of a few monthly indicators and high-frequency data on
retail mobility and internal credit card transactions.
Today's BMO BAI report can be found at
https://economics.bmo.com/en/publications/detail/bbd6fba1-821b-49f8-881e-da0e867ff811/.
About BMO Financial Group
Serving customers for 200 years and counting, BMO is a highly
diversified financial services provider - the 8th largest bank, by
assets, in North America. With total assets of $974
billion as of July 31, 2020, and a team of diverse and
highly engaged employees, BMO provides a broad range of personal
and commercial banking, wealth management and investment banking
products and services to more than 12 million customers and
conducts business through three operating groups: Personal and
Commercial Banking, BMO Wealth Management and BMO Capital
Markets.
SOURCE BMO Financial Group