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Canada August GDP up 1.2% in fourth consecutive monthly gain

OTTAWA (Reuters) - The Canadian economy grew by 1.2% in August, its fourth consecutive gain and slightly stronger than analyst estimates, Statistics Canada data showed on Friday, though growth was expected to slow in September.

Analysts, on average, had expected a gain of 0.9% in August. Real GDP is expected to rise 0.7% in September, Statscan said in a preliminary flash estimate.

Fifteen of Canada's 20 industrial sectors posted increases in August and two were essentially unchanged, Statscan said. The goods-producing sector posted a 0.5% increase, while the service-producing sector grew by 1.5%.

"The good news is that Canada's economy continued to heal in both August and September," said Royce Mendes, senior economist at CIBC Capital Markets, in a note, adding that optimism would be offset by the lower September estimate.

Despite the growth, economic activity was still about 5% below pre-pandemic level in August, Statscan said.

The August gains were driven by the public sector, which grew 1.9%. The manufacturing sector was up 1.2%, though the pace of growth was far slower than in the previous three months.

(Reporting by Julie Gordon and Dale Smith; editing by Steve Scherer, John Stonestreet and Jonathan Oatis)

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