Canada's economy slows in October, but still resilient after rate hikes

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The Canadian economy grew by 0.1% in October and is expected to expand at the same pace in November, data showed on Friday, a sign that the full impact of seven consecutive interest rates hikes this year has yet to play out.

October growth slowed compared with September's 0.2% gain, which was an upward revision from a previously reported 0.1% increase, Statistics Canada said. October's increase was in line with a median of analysts' forecasts.

The latest figures show that growth is "holding up perhaps a bit better than expected for Q4," said Robert Kavcic, Senior Economist at BMO Capital Markets, in a note. The Bank of Canada has hiked rates at a record pace of 400 basis points in nine months to 4.25% - a level last seen in January 2008 - to fight inflation that is far above its 2% target.rate eased to 6.8% in November, but was slightly higher than had been expected because of broad-based price pressures, according to data from earlier this week, leaving the door open for another rate increase in January.in setting the policy rate.

Goods-producing industries posted a 0.7% decrease in October after four continuous months of growth, mainly due to a decrease in mining, quarrying, and oil and gas extraction and weakening in the manufacturing sector.

 

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