The Canadian economy experienced a recession for the third consecutive month in October, according to data released on Friday by Statistics Canada.

The economic engine of Canada continued to stall in the fourth quarter, as reacts Royes Mendez, an economist at Desjardins Group and head of macroeconomic strategy, in a client note.

The federal agency reported that activity in service-producing industries rose by 0.1% in October, while goods-producing industries remained unchanged.

Statistics Canada also expects real GDP for November to have increased by 0.1%, led by gains in manufacturing, transportation and warehousing, as well as agriculture, forestry, fishing, and hunting, which were partially offset by a decline in retail trade.

For her part, Olivia Cross from Capital Economics found that GDP figures were weaker than expected, which would increase the risk of the economy shrinking again in the last quarter. This is another reason to believe the Bank of Canada will soon move towards monetary easing.

She added that overall, quarterly GDP growth is likely to be less than the Bank of Canada’s forecast of an annual increase of 0.8%.

Minor declines in some sectors...

In October, the manufacturing sector declined by 0.6% and wholesale trade by 0.7%, again according to Statistics Canada. Meanwhile, retail trade grew by 1.2%, while the mining, quarrying, and oil and gas extraction sectors saw an increase of 1%.

The transportation and warehousing sector fell by 0.2% in October. A strike at Saint-Laurent Seaway Management Corporation led to decreased activity in some transportation subsectors.

This included a 3.7% contraction in shipping. This is the first decline since the labor dispute at ports in British Columbia, including Vancouver. The trucking sector also decreased by 0.9%.

Andrew Grantham, an economist at CIBC, said that while supply problems continue to hinder activity due to events like the strike at St. Lawrence Seaway Management Corporation and the auto sector strike in the United States, there are also indications of weak demand.