Household spending slowed for the second consecutive quarter, to 0.2 percent in the fourth quarter from a 0.3 percent increase in the prior quarter, attributable to outlays for goods (-0.2 percent), namely durable (-0.5 percent), as motor vehicles purchases dropped (-0.6 percent); semi-durable (-0.3 percent), and non-durable were flat. Meantime, outlays for services rose 0.5 percent, led by life insurance and financial services (0.9 percent).
Housing investment declined 3.9 percent as the market continued to soften, with the largest decrease in new construction (-5.5 percent), followed by renovations (-2.7 percent) and ownership transfer costs (-2.6 percent).
Gross fixed capital formation shrank 2.7 percent, faster than a 1.7 percent contraction in the previous period. Business investment in non-residential structures, and machinery and equipment went down 2.9 percent, the sharpest drop since the fourth quarter of 2016, as non-residential buildings (-3.1 percent), engineering structures (-4.3 percent), and machinery and equipment (-1.2 percent). These declines were moderated by a 6.1 percent increase in business investment in intellectual property products, mainly attributable to mineral exploration and evaluation, which can be influenced by anticipated prices and potential new reserves.
Export dropped 0.1 percent, following a 0.8 percent increase in the previous quarter, as a 1.6 percent rise in services partly offset a 0.4 percent decline in goods. Export were down for forestry products and building and packaging materials (-3.2 percent); metal and non-metallic mineral (-2.0 percent) and energy (-0.6 percent) products. Meantime, exports rose for travel (3.9 percent) and commercial (1.8 percent) services while decreased for transportation services (-2.7 percent).
Import declined 0.3 percent, after a 2.2 percent in the third quarter of 2018, mostly due to lower purchases of basic and industrial chemicals, plastic and rubber products (-4.6 percent); motor vehicles and parts (-1.3 percent) and metal and non-metallic mineral products (-2.4 percent). On the other hand, imports of energy products were flat, while aircraft, engines and parts rebounded 17.1 percent. Also, purchases of travel services (1.9 percent) and commercial services (0.8 percent) pushed total service import growth to 1.2 percent.
Considering full 2018, the economy grew 1.8 percent easing from a 3.0 percent in 2017.