UPDATE 2-Canada January GDP recovers most of December's loss

Mon Mar 31, 2014 10:02am EDT
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* Economy grows 0.5 pct in Jan; fell 0.5 pct in Dec

* Severe weather had cut into December output

* Real-dollar output in Jan still lower than it was in Nov

* Payrolls report shows jobs decline, not gain, in Jan (Adds analysts' comments, weekly earnings, paragraphs 4, 6-8)

By Randall Palmer

OTTAWA, March 31 (Reuters) - The Canadian economy bounced back more strongly than expected in January from a weather-induced decline in December but failed to regain all the output that was lost in the final month of 2013, Statistics Canada said on Monday.

Gross domestic product (GDP) showed real, seasonally adjusted growth of 0.5 percent in January after December's 0.5 percent decline. That was at the top end of a range of estimates in a Reuters survey of analysts. The median forecast was for 0.4 percent growth.

But in inflation-adjusted dollar terms, GDP was still a shade lower in January than it was in November.

"Markets will draw comfort from the confirmation that December's dive was indeed a weather disruption rather than a sign of things to come," said CIBC World Markets chief economist Avery Shenfeld.   Continued...