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Expect to see a nice bounce in Canada’s second-quarter economic performance when numbers are released this week. Just remember to savour it, because the following three months may not be as upbeat.

Consensus expectations are for Statistics Canada to report Thursday a gross domestic product reading of 3 per cent. Some economists forecast a number as strong as 3.5 per cent, and if that happens, it could shake up market expectations for the Bank of Canada’s next move on interest rates and, by extension, where the Canadian dollar is heading.

The second-quarter showing will mark a hefty pickup from annualized growth of just 1.3 per cent in the first three months. But the central bank forecasts third-quarter growth of 1.5 per cent, so it may be a case of going from zero to hero and back again.

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Economists believe consumer spending and exports helped pump the economy, with some drag from a housing market hurt by new mortgage qualifications and higher interest rates.

Observers, for now, are expecting the Bank of Canada to hold off raising its benchmark rate until October, and sit on its hands at its September meeting.

“Monthly data have us tracking a 3-per-cent pace for Q2 GDP,” said Andrew Grantham of CIBC Capital Markets.

"That’s good, but not good enough to force the BoC’s hand in September, given its [monetary policy report] forecast was already for 2.8-per-cent growth in the quarter," he added.

“However, there’s always the risk of a surprise, particularly in recent years, to the upside for Q2. That could be nothing more than chance. But with recent quarterly data running under the pace of monthly figures, there’s a more meaningful reason for a catch-up to be in the cards. A better number than consensus expectations or tracking numbers may give a short-term boost to the [Canadian dollar].”

CIBC and Royal Bank of Canada both project growth of 3 per cent, in line with the consensus.

But consider that Bank of Montreal forecasts 3.3 per cent, and Toronto-Dominion Bank falls on the high side at 3.5 per cent.

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"If, and only if, NAFTA negotiations evolve into a deal in the next couple of weeks, expect the 3-per-cent Q2 growth rate to be enough for central bankers to raise rates another quarter-point in September," said Royce Mendes, Mr. Grantham's colleague at CIBC.

"Otherwise, we would need a notable upside surprise in GDP to make the case for September."

Even then, of course, the Bank of Canada expects a second-quarter pop to be a one-hit wonder sandwiched between the first and third.

What else to watch for this week:

MONDAY: WATCHING, WAITING

The start of the new trading week looks to be somewhat meh, but we’ll watch for how markets open, where things stand with NAFTA and whatever President Donald Trump has to say – not so much about how his impeachment would kill the longest postwar bull run, but about what’s transpiring in Washington.

"The president projected that [the bull market] would all come to naught, should he somehow be impeached," BMO chief economist Douglas Porter said in a report.

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“It’s fascinating enough that he is willing to speak openly about either topic (impeachment or stocks), but we’ll stay focused on the markets, especially since any political norm has been blown out of the water in the past two years,” added Mr. Porter, who went on to talk about market developments, which, yes, are important, but nowhere near as entertaining.

TUESDAY: BANK EARNINGS

BMO and Bank of Nova Scotia pick up where Royal Bank of Canada and CIBC left off last week, each releasing third-quarter results. RBC and CIBC both reported a strong quarter, and each raised its dividend.

Also on tap is the release of the S&P Case-Shiller home price index.

Best Buy and Tiffany & Co. report quarterly results, as well.

WEDNESDAY: CURRENT ACCOUNT

BMO expects Statistics Canada to report that the current account deficit “narrowed massively” to $15.6-billion in the second quarter, helped along by the impact of stronger oil prices on exports.

"Our estimate would peg the current account shortfall at around 2.8 per cent of GDP, nearly a full percentage point improvement from Q1," said Benjamin Reitzes, BMO's Canadian rates and macro strategist.

Watch, too, for results from National Bank of Canada, Canadian Western Bank and WeedMD.

THURSDAY: SPENDING AND INCOME

Along with GDP, it's an interesting day for corporate results, with TD, Lululemon Athletica Inc. and BRP all reporting.

And watch for the U.S. government’s report on personal spending and income, each expected to show a gain of 0.4 per cent in July. The numbers, said Andrew Hunter, U.S. economist at Capital Economics, “are likely to show that real consumption growth remains unusually strong.”

FRIDAY: CHINA

Worth watching are China’s official purchasing managers indexes numbers.

“These indices and virtually all other activity measures weakened in July,” said Chang Liu of Capital Economics. “The slowdown seems set to continue for a while yet.”

Capital Economics forecasts that Brazil, meanwhile, will report the economy shrank 0.2 per cent in the second quarter from the first, hit by truck drivers going on strike in May.

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