Canada's Stronger Current Account Signals Q2 GDP Growth Outlook, BMO Says

10:23 AM EDT, 08/27/2026 (MT Newswires) -- The energy-led improvement in Canada's current account in the second quarter reinforces BMO Capital Markets' view of solid second-quarter gross domestic product growth. The current account swung to a C$8.8 billion surplus in the second quarter from a C$8.3 billion deficit in Q1, ending four years of consecutive deficits, according to Statistics Canada data released on Thursday. "The energy-driven boost to Canada's current account is one reason why we expect the economy expanded at a solid pace in Q2," wrote BMO Senior Economist Shelly Kaushik in a note. However, the bank will be watching how heightened US trade uncertainty affects investment and other external flows in the third quarter, added Kaushik. The turnaround reflected a stronger goods balance, boosted by higher energy prices. Merchandise trade should stay supported by restricted Strait of Hormuz activity, though US tariffs will offset some gains, according to BMO.