Statistics Canada says strong numbers for energy exports helped the country's real gross domestic product bounce back from a second-quarter contraction.
The Fort McMurray wildfires back in May of this year really messed with our economy, mainly because of the temporary shutdowns in oil sands production, the mass evacuations that ensued, and the overall disruption to employment in the area.
"Economic momentum in September is thus expected to point to an economy that has returned to its "business as usual" of sub-two per cent growth", the bank said.
Statistics Canada reported Wednesday that real gross domestic product rose at an annualized rate of 3.5 per cent in the quarter ended September 30, the fastest quarter-over-quarter pace since the 2014 second quarter. The Bank of Canada's official forecasts, last updated in October, call for an annualized growth pace of just 1.5 per cent in the fourth quarter, and annual growth of 1.1 per cent in 2016 and 2 per cent in 2017.
Statscan said exports of goods and services surged at an annualized pace of 8.9 per cent in the quarter, a reversal from the 14.8-per-cent decline in the second quarter.
Housing more than fully offset strong non-residential business investment, meaning overall business capital spending was down for an eighth-straight quarter.
The Canadian dollar was boosted by the data and a jump in oil prices.
But TD Economist Brian DePratto seems to be much more cautious than that.
"Unfortunately, when you kind of open the hood on it, there's a little bit less to be happy about than what we might have expected". Household spending remained a key economic driver and a continued slide in business investment was a disappointment because analysts had been expecting to a bit of a "bottoming out", he said.
A rebound in energy exports after a second quarter decline is at the root of the growth.
Exports of goods grew 2.3% thanks to an increase in consumer goods (+3.6%), metal ores and non-metallic minerals (+5.7%), industrial machinery, equipment and parts (+3.7%) and forestry products and building and packaging materials (+2.7%).
The lower transfer costs followed British Columbia's introduction of a new tax on home purchases by non-residents, the report noted.