Canada: Annualized real GDP declines to 0% in Q4 vs. 1.5% expected

Canadian economy performed much worse than expected in Q4.
USD/CAD rises toward 1.3600 following the disappointing GDP data.

Eren Sengezer FXStreet

The Canadian economy stagnated in the fourth-quarter with the annualized real Gross Domestic product (GDP) growth arriving at 0%. This reading followed the 2.3% expansion recorded in the third quarter and missed the market expectation for a growth of 1.5% by a wide margin.

On a monthly basis, real GDP in Canada contracted by 0.1%.

Statistics Canada explained slower inventory accumulations and declines in business investment in machinery and equipment were behind the poor economic performance in Q4.

Market reaction

USD/CAD edged higher with the initial reaction and was last seen posting small daily gains at 1.3585.

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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