In Q2, growth was driven by household spending and goods exports, up 1.9% and 2.3%, respectively.
President Donald Trump hailed the latest figures, declaring "we are really on our way".
That's the strongest growth since the first quarter of 2015.
The second-quarter result likely cements the likelihood of at least one more rate increase from the Bank of Canada in 2017. Fixed nonresidential investment rose at a 6.9% pace last quarter, up from an initial estimate of 5.2%, including stronger spending on software.
Indeed, families appeared to have room to both spend and save more, with the household savings rate rising a notch, to 4.6 per cent from 4.3 per cent in the first quarter.
Canada's economy accelerated far more than expected in the second quarter, racking up the strongest pace of growth in almost six years, as consumers continued to spend and energy exports rose, data from Statistics Canada showed on Thursday. There is no reason that we could not manage. "These include a sea change in demographic factors like slowing population and labor force growth and a downshift in productivity growth".
During last year's campaign, Trump pledged to boost economic growth to 4 percent or better.
A consensus of economists had predicted Canada to deliver a second-straight growth reading of 3.7 per cent, according to Thomson Reuters.
Secretary of State says Trump doesn't speak for American values
Rex Tillerson , usually discrete on the scene of domestic policy, has not explicitly denounced these statements . One failed and none posed risk to the United States, the US Pacific Command said in a statement late Friday.
"We do believe that this suite of robust numbers all but locks in another rate hike this year", Porter wrote.
Besides wild cards like Hurricane Harvey's impact on the Gulf Coast, and political uncertainty about issues like tax reform and a possible increase in infrastructure spending, traders are also keeping an eye on the Federal Reserve.
Still, construction activity rose 2.0 per cent in the month of June, partly due to the end of a construction strike in Quebec. "But it should not be taken for granted, the u.s. economy is not growth of 3 %", adds he.
Mark Zandi, chief economist at Moody's Analytics, said he expected growth for the current quarter of 2.9 percent and a 2.6 percent gain for the fourth quarter.
The Canadian economy surged in the second quarter, surpassing already elevated expectations, and recorded its best 12-month run in over a decade, securing its title as the hottest performer so far in 2017 among Group of Seven countries.
But they do not expect it to be sustained at this level, and they warned that the drag on growth from Hurricane Harvey is likely to be substantial given the extent of the damage wrought by rains and flooding.
Canadian government bond prices were mostly lower across the yield curve, with the two-year price down 7 Canadian cents to yield 1.275 per cent and the 10-year falling 13 Canadian cents to yield 1.851 per cent.
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