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A recovery in exports helped Canada avoid a recession in the fourth quarter as gross domestic product rose 1.0 percent year over year. %GrossDomesticProduct, a monetary measure of the market value of all the final goods and services produced in a specific time period, was stronger than expected and markedly higher than the 0.5 percent contraction in the third quarter.

Exports were boosted by shipments of crude with sustained oil production in Alberta. However, while exports rose for the quarter, imports slipped on a lower intake of metal products, vehicle parts, and passenger cars and light trucks. Meanwhile, consumer spending gained on outlays on new trucks, vans and utility vehicles as back orders were filled and supply chain troubles continued to ease. A weakening resale market pushed housing investments to fall for a sixth quarter out of the last seven.

The upward trend in growth is expected to continue, with preliminary estimates showing 0.4 percent real GDP growth for the month of January.

The better-than-expected growth eased pressure on the Bank of Canada to preemptively cut rates. Instead, the central bank is expected to maintain rates at its meeting next week. Overall, economic growth in 2023 was the slowest since 2016, with the exception of 2020, according to Statistics Canada.

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