Canadian economy regains momentum despite looming tariff threats

Published 31/01/2025, 14:48
© Reuters.

Investing.com -- The Canadian economy showed signs of strength in the closing stages of 2024, due to a swift series of interest-rate reductions, amid looming 25% tariffs threatened by the Trump administration.

Preliminary data indicated that the gross domestic product (GDP) grew by 0.2% in December, as reported by Statistics Canada on Friday. This shows an improvement from a 0.2% decrease in November, which was the most substantial monthly shrinkage since December 2023 and lower than the 0.1% fall predicted by economists in a Bloomberg survey.

Combining this with a 0.3% rise in October, industry-based figures suggest that the fourth-quarter output increased at an annualized rate of 1.8%, wrapping up 2024 with a 1.4% growth for the entire year. This growth rate aligns somewhat with the initial forecasts.

The Bank of Canada had predicted the GDP for both the final quarter and the entire year to grow by 1.8%, while economists had anticipated a slightly weaker growth of 1.6% for the quarter and 1.3% for the year.

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