Canada's economy grew at an annual rate of 1.0% in the fourth quarter, beating expectations as lower imports were offset by higher exports, the national statistics agency said Thursday.
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According to Statistics Canada's press release, oil accounted for the 1.4% increase in exports, following a slight decline in the previous quarter, while imports fell 0.4%, particularly due to lower shipments of vehicles and parts.
Business investment fell for the sixth time in the last seven quarters.
The growth observed was largely due to the 6.2% increase in crude oil exports, which coincided with sustained crude oil production in Alberta.
According to Statistics Canada, household spending rose 0.2% in the final three months of 2023, while workers' compensation growth, which had accelerated recently, slowed to 2020 levels.
“The Canadian economy managed to avoid recession, but the increase in activity was not very encouraging,” said Desjardins Bank analyst Royce Mendes.
“The growth observed in the fourth quarter did not occur within Canada's borders and is particularly discouraging given the population growth observed late last year,” he added in a note.
The latter estimates that the Bank of Canada could begin a rate cutting cycle in June.
At the end of January, this institution kept its key interest rate at 5% and said it was “concerned about the risks related to the inflation outlook, in particular the persistently high underlying inflation”. The key interest rate has been at its highest level in 22 years since July.