The Canadian economy grew at an anemic annual rate in the fourth quarter, confirming that global headwinds were a significant drag in the final months of 2011.
Despite an uptick in activity in December, real gross domestic product rose only 0.4 percent in the fourth quarter, after advancing 1.0 percent in the third quarter, official data from Statistics Canada revealed Friday.
Demand for exports slowed after a strong third quarter, with growth easing to 1.1 percent from 3.8 percent. The nation's red-hot housing market also cooled off, as new housing construction declined 0.4 percent following two quarters of increases of 3.0 percent or more.
Modest growth in manufacturing, retail trade, and oil and gas extraction prevented an even more dismal fourth quarter performance. Mining excluding oil and gas extraction, utilities, wholesale trade, and the finance and insurance sector decreased during the quarter. On a monthly basis, real GDP by industry increased 0.4 percent in December.
The Bank of Canada has been taking a wait-and-see approach regarding the nation's increasingly lackluster economic performance, but may be compelled to ease monetary policy unless activity picks up in the current quarter.