Canada’s economy grew at an annualized rate of 1.4% in the last quarter of 2006. Higher consumer spending and export growth were the main drivers in the year-end growth, Statistics Canada said today.

Fourth-quarter growth was down from the 2% annualized growth seen in the second and third quarters and 3.8% in the first quarter of 2006.

On a monthly basis, however, the economy showed signs of picking up. December’s growth was 0.4%, up from November’s 0.3% and October’s 0.1% expansion.

For all of last year, Canada’s economy expanded by 2.7%, led by the construction, retail and wholesale trades and the finance and insurance sectors.

In 2005, the economy grew by 2.9%.

Growth in final domestic demand continued to outpace that of GDP in the fourth quarter, StatsCan said. Final domestic demand was supported by personal expenditure, especially on services and on durable goods, along with business investment in non-residential structures. The acceleration in exports added significantly to GDP growth in the quarter.