(Ottawa) Canada’s economy contracted by 1.1% year-over-year in the third quarter of this year, according to Statistics Canada.
The federal agency says the decline in international exports and a slowdown in inventory buildup by companies was partially offset by increased government spending and investment in housing.
Housing investment rose 2% in the third quarter after recording five consecutive quarterly declines. The 6.5% increase in new construction was partially offset by a 4.3% decrease in transfer costs, which account for resale activity.
On the other hand, the agency revised the real GDP figure for the second quarter upwards, noting that the economy did not decline, but rather grew by 1.4% year-on-year.
The Statistics Canada report shows that consumer spending remained flat for the second straight quarter, and business capital investment fell by 2%.
Interest rate hikes by the Bank of Canada have put downward pressure on consumer and business spending as both face higher borrowing costs.
Statistics Canada also noted that employee compensation increased by 1.3% in the third quarter and that net household savings also increased.
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