09/30/2015 08:38 EDT | Updated 09/30/2015 09:59 EDT

Canadian Economy Grew In July, On Track To Double Expectations In Q3

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Canada's economy grew 0.3 per cent in July, Statistics Canada says, faster than the rate that economists had generally expected.

With these numbers in, many economists are now predicting that Canada will nearly double the 1.5-per-cent growth rate that the Bank of Canada had predicted for the third quarter.

The growth was led by a bounceback in the struggling oil, gas and mining sector, StatsCan said, growing 2.9 per cent in the month. But the sector is still 1.8 per cent smaller than it was a year ago.

Manufacturing and finance and insurance also posted strong gains during the month, though manufacturing still has a ways to go -- it's still down 0.7 per cent from a year ago. Construction and utilities shrank. The construction sector is down 3.9 per cent over the past year.

Still, the news means Canada's economy likely emerged from a recession in the third quarter of this year, after shrinking for the first two quarters.

StatsCan revised downwards its estimate for the previous month, June, which was the first month of economic growth in Canada this year. The agency says the economy grew 0.4 per cent in June, down from its earlier estimate of 0.5 per cent.

"The back-to-back gains in GDP suggest that the economy rebounded firmly from the very weak first half of 2015," BMO economist Benjamin Reitzes wrote. "Indeed, third-quarter GDP growth is tracking in the 2.5 per cent to 3 per cent range, consistent with our above consensus 2.8 per cent call. That’s also well above the Bank of Canada’s 1.5 per cent forecast."

CIBC World Markets economist Nick Exarhos echoed that sentiment, calling for 2.7 per cent growth in the third quarter.

Most observers said Wednesday the news means it's less likely that the Bank of Canada will cut interest rates again.