UPDATE 1-Canada economy bounces back in January on factories

Thu Mar 28, 2013 8:34am EDT
 
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* Economy grows 0.2 pct in Jan vs forecast of 0.1 pct growth

* Manufacturing sector was main driver of growth

OTTAWA, March 28 (Reuters) - Canada's economy bounced back in January with 0.2 percent growth following the weakest two quarters since the 2008-09 recession thanks to solid manufacturing, mining and an end to a work stoppage in professional ice hockey, Statistics Canada said on Thursday.

Analysts surveyed by Reuters had expected a 0.1 percent increase in monthly gross domestic product following a 0.2 percent decline in December.

Manufacturing contributed the most to the rebound, expanding 1.2 percent on gains in both durable and non-durable goods. Producers of fabricated metals and wood products showed gains while the transportation equipment industry softened.

Statscan also noted strength in mining, quarrying and oil and gas extraction, which increased 0.2 percent, and in wholesale trade, up 0.7 percent. The arts and entertainment sector got a one-time boost of 4.1 percent after owners and players in the National Hockey League reached a deal to end their labor dispute and begin a delayed hockey season.

Industries that shrank in January included agriculture and forestry, construction, and finance and insurance.

The January data puts the economy on track to post stronger first-quarter growth after a weak 0.6 percent annualized growth in the fourth quarter. The Bank of Canada in January projected a 2.3 percent advance in the first quarter, although it will update that projection on April 17.