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Reuters Canada Business Summary

29/08/08

Canada skirts recession in second quarter

OTTAWA (Reuters) - The economy narrowly avoided a recession in the second quarter but the tepid 0.3 percent annual growth rate raised doubts about how long the Bank of Canada could afford to keep interest rates on hold. Gross domestic product shrank 0.8 percent in the first quarter, revised from the original estimate of a decline of 0.3 percent, as global demand waned for exports such as autos, forest products and machinery, Statistics Canada said on Friday.

BCE and Telus to announce wireless pact: report

OTTAWA (Reuters) - BCE Inc , Canada's biggest telecom company, and Telus Corp , the country's No. 2 phone company, will share the cost of a next-generation wireless network upgrade, the Financial Post newspaper said on Friday. The paper said that BCE and Telus are expected to announce next week an upgrade to high speed packet access networks, estimated to cost as much as C$1 billion ($1.05 billion).

Toronto stocks edge up as energy shares gain

TORONTO (Reuters) - The Toronto Stock Exchange's main index climbed slightly on Friday, lifted by energy issues that helped offset tech shares that were hurt by concerns of a weakening appetite for business spending. Economic news set the tone early after data showed the Canadian economy had a slight 0.3 percent annual growth rate in the second quarter and narrowly escaped falling into a recession, generally defined as two quarters of decline in a row.

Greenpeace Canada blasts Syncrude lawsuit

TORONTO (Reuters) - Greenpeace Canada blasted a lawsuit brought against it by Syncrude Canada Ltd, saying the move was designed to intimidate critics of the sprawling oil sands developments in northern Alberta. The suit comes after Greenpeace protesters targeted a waste-water pipe at Syncrude's Aurora mine, north of Fort McMurray, Alberta, on July 24, demanding a halt to rising crude production from the oil sands, which the environmental group says is wrecking the environment.

Wal-Mart cuts staple food prices in Ontario

OTTAWA (Reuters) - Wal-Mart Stores Inc said on Friday it would cut prices on bread, milk, butter and eggs in the province of Ontario, where the economy has been struggling, putting pressure on its rivals. The discount retailer said price cuts of up to 35 percent on staple foods in some locations would help consumers in the heavily industrialized province, which has been hit hard by high oil prices and the U.S. economic slowdown.

Canadian rates seen firm through 2008

TORONTO (Reuters) - Canada's primary securities dealers expect the Bank of Canada to leave its key interest rate steady next week, and likely through the end of the year, as inflation is seen persistent despite slow economic growth. Eleven of Canada's 12 dealers surveyed by Reuters forecast the central bank will leave its overnight rate at 3 percent on September 3. One dealer expects a quarter percentage point cut.

Electric fault spurs big GM recall

DETROIT (Reuters) - General Motors Corp is recalling 857,735 vehicles equipped with a heated windshield wiper fluid system for a potential short-circuit problem, according to federal safety regulators. A short-circuit in the system may cause other electrical features to malfunction, create an odor or cause smoke, increasing the risk of a fire, the National Highway Traffic Safety Administration said on its website.

Enbridge and BP plan pipes to get Canada oil to Gulf

CALGARY, Alberta (Reuters) - Enbridge Inc and BP Plc plan to spend up to $2 billion expanding their pipeline systems to ship growing volumes of Canadian crude oil to the U.S. Gulf Coast, they said on Friday. Enbridge, best known as operator of the main artery for Canadian oil exports, and BP, the British oil major, said they aim to develop a system to ship 250,000 barrels of oil a day to Texas City, Texas, from Flanagan, Illinois, by 2012.

Oil pressured by strong dollar after storm support

NEW YORK (Reuters) - Oil prices were nearly unchanged by midday Friday as a stronger dollar balanced concerns that Tropical Storm Gustav will impact U.S. offshore oil and gas production. Earlier, crude prices had flirted with $119 a barrel on concerns that Gustav, which was poised to enter the Gulf of Mexico over the weekend as a hurricane, would damage offshore oil facilities in the gulf.

Loonie eases on sluggish GDP growth

TORONTO (Reuters) - The Canadian dollar slipped 0.3 percent versus the U.S. dollar on Friday, as Canada's economy showed razor-thin growth in the second quarter, thus avoiding a technical recession but suggesting an economy in stagnation. Domestic bond prices weakened, as the slower growth was not enough to convince the market that the Bank of Canada will cut interest rates next week.

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