- Real GDP growth in Canada was stronger than expected in Q4 on an annualised quarterly basis, but weaker than expected Mom in December.
- The loonie did not react to the mixed data as focus remains on geopolitics.
Real GDP in Canada expanded at an annualised pace of 6.7% in Q4, above expectations for a reading of 6.5%, the latest report from Statistics Canada showed on Tuesday. The QoQ pace of growth in Q4 clocked in at 1.6%, up from 1.3% in Q3. The YoY pace of GDP growth in Q4 (i.e. Q4 GDP in 2020 versus Q4 GDP in 2021) was 3.26%, down from 3.84% in Q3.
The stronger annualised pace of growth in the quarter masked a weaker than expected MoM pace of growth in December of 0.0%, slightly below expectations for 0.1%. The economy was hit in December and January by the rapid spread of the Omicron Covid-19 variant. So growth was never expected to be super strong.
Market Reaction
The loonie did not seem to react to the latest mixed GDP figures, with market focus very much instead still on geopolitics.