The August 2011 GDP numbers are out, so it's time for my quarterly attempt to provide an estimate for quarterly GDP growth a month before Statistics Canada releases its first estimates - the most recent exercise is here. This is done by using simple linear regression model of monthly GDP growth on monthly LFS data for employment and hours worked to produce an estimate for (in this case) an estimate for September 2011 GDP. This estimate is then combined with available monthly GDP for July and August to construct an estimate for quarterly GDP for 2011Q3.

The number I get is an annualised growth rate of **3.1%**; here is a history of the forecasts generated by this methodology compared to the preliminary StatsCan estimates and the most recent data available:

Quarter WCI estimate First StatsCan

releaseLatest data 2009Q1 -6.9% -5.4% -8.2% 2009Q2 -3.4% -3.4% -3.8% 2009Q3 -0.4% 0.4% 1.7% 2009Q4 4.0% 5.0% 4.9% 2010Q1 5.5% 6.1% 5.5% 2010Q2 2.7% 2.0% 2.3% 2010Q3 1.5% 1.0% 2.4% 2010Q4 1.9% 3.3% 3.1% 2011Q1 3.8% 3.9% 3.5% 2011Q2 0.1% -0.4% -0.4% 2011Q3 3.1%

As a point of comparison, the Bank of Canada's estimate for 2011Q3 in the October 2011 *Monetary Policy Report* was 2.0%.

Impressive track record so far.

I hadn't noticed that revised 2009Q1 number until now--shocking!

Posted by: Andrew F | November 01, 2011 at 12:41 AM

September was an odd month for the LFS with BC gaining 40K jobs - I'm not sure that number is actually reflective of economic growth but rather a one-time increase. Might be skewing your number to the high side.

Posted by: Brendon | November 01, 2011 at 10:24 AM