Canada: Real GDP expands by 0.7% in January vs. 0.5% expected

• Canadian economy grew at a stronger pace than expected in January.
• USD/CAD trades with modest losses near 1.2600 after the data.

Canada's Real Gross Domestic Product (GDP) expanded by 0.7% in January, the data published by Statistics Canada showed on Wednesday. This reading followed December's growth of 0.1% and came in better than the market expectation of 0.5%.

"This ninth consecutive monthly increase continued to offset the steepest drops on record in Canadian economic activity observed in March and April 2020," the publication read. "However, total economic activity was about 3% below the February level before the COVID-19 pandemic."

Market reaction

The USD/CAD pair edged modestly lower with the initial reaction and was last seen losing 0.27% on a daily basis at 1.2598.