Analysis: The Composite Index of Leading Indicators can be used to estimate monthly GDP results several months ahead of their actual release. July’s report suggests that the economy may have grown at a slower pace compared to monthly growth rates experienced earlier in the year, which is in line with the Bank of Canada’s recent downgrade of its expectations for Canadian economic growth. Increased borrowing costs and more stringent lending guidelines for insured mortgages led to a slower pace of sales in the second quarter. While strong home sales and related economic activity played a key role in the initial recovery from recession, the drivers of growth over the longer term will be more diverse with a greater contribution from goods production.